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UPDATE 1-Chevron resumes operation at Gorgon LNG train 1 after month-long outage
January 4, 2017 / 5:19 AM / 7 months ago

UPDATE 1-Chevron resumes operation at Gorgon LNG train 1 after month-long outage

2 Min Read

* Gorgon LNG train 1 resumes operation - spokesman

* Asian spot LNG prices at near 2-year high (Adds details, context)

By Mark Tay

SINGAPORE, Jan 4 (Reuters) - Chevron Corp said on Wednesday it has resumed production of liquefied natural gas (LNG) at one of its two units at the $54 billion Gorgon project, located off Western Australia, after an outage of slightly more than a month.

"Gorgon LNG Train 1 operation resumed earlier this week," a spokesman for Chevron wrote in an emailed statement. "Production was halted in late November 2016 to assess and address some performance variations," the statement said, without disclosing details of the "variations".

Output at the plant's train 2 production line was unaffected during the period, the spokesman said. The Gorgon project had continued to produce and load cargoes, he said.

The massive Gorgon project has been plagued by a string of operational issues since it started up in March 2016.

Despite the continued production form the second train, the supply disruption led to an urgent demand for replacement cargoes to fulfil customer commitments, according to traders familiar with the matter.

That helped spot LNG prices for delivery to North Asia LNG-AS rise to near two-year highs of $9.50 per million British thermal units (mmBtu) last week, their highest level since early 2015, compared with spot levels around $7/mmBtu before news of the Gorgon train 1 outage broke in late November.

Reporting by Mark Tay; Editing by Richard Pullin and Kenneth Maxwell

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