Ichthys & Prelude FLNG

Ichthys LNG is a standout oil and gas project poised to produce 9.3 million tonnes of LNG, 1.65 million tonnes of LPG, and over 100,000 barrels of condensate annually. This project encompasses subsea, offshore, pipeline, and onshore components. The gas and condensate from the Ichthys Field traverse an impressive 890 km pipeline to reach onshore facilities near Darwin for processing.

The Ichthys Project consisted of three major segments operated by INPEX:

• Offshore Facilities
• Gas Export Pipeline
• Onshore LNG Facilities

The Offshore Facilities are comprised of several significant components:

• Subsea production wells (42)
• Subsea production systems (SPS)
• Umbilicals, risers and flowlines (URF)

This project also included a revised ARO estimate for the Prelude FLNG facility. INPEX holds a 17.5% interest in the Shell-operated Prelude FLNG facility, moored offshore 475 kilometres northeast of Broome, Western Australia. The facility, commissioned in June 2019, is expected to stay moored at its current location for 25 years.

Prelude is designed to produce 3.6 million tonnes per annum (mtpa) of LNG, 1.3 mtpa of condensate, and 0.4 mtpa of LPG for export. It is Shell’s first deployment of its FLNG technology, allowing for economic access to remote offshore gas resources. Prelude has the capacity for production, liquefaction, storage, and transfer of LNG at sea.

In Q2 2023, RESL delivered a Decommissioning ARO Study for the INPEX Australia Ichthys Project. Selected for our comprehensive decommissioning expertise, RESL’s proficiency spans wells, subsea systems, production vessels, onshore plants, and pipelines. Our proposal, notable for its clarity and detail, reflected a singular vision across the project’s five distinct facets, demonstrating the depth and breadth of our experience. Our extensive, specialised expertise played a pivotal role in our selection.

This project was principally an AACE class 5 decommissioning cost estimate, significantly enhanced from the previous ARO. The aims of this study were two-fold:

1. Upgrade the ARO to minimum AACE Class 5 standard:
   • Accuracy is dependent on data quality
   • Maintain Total Removal as ARO reference case (worst case)
   • Defensible ARO with a full audit trail for future upgrades
2. Include Risk Management work required to:
   • Identify and assess key risks
   • Initiate inclusion of ESG conformance using PESTEL risk framework

Our report establishes a defensible and well-substantiated planning and cost basis for the future decommissioning of the Ichthys LNG Project.

Moreover, we explored future factors affecting decommissioning, offering a process for continuous evaluation and cost control, consistent with AACE standards and industry benchmarks. Completed in record time and endorsed by the client, this report paves the way for ongoing collaboration on subsequent projects.