* Third and final production train at Gorgon plant starts up
* Production at Gorgon Train Two suspended on March 27
* Reliability of Train Three in question -traders
* Spot LNG supplies could rise on Train Three startup
(Adds details on Train 2 outage, trader comments)
By Mark Tay
SINGAPORE, March 28 Chevron has started
production of liquefied natural gas (LNG) from the third of
three production units at the Gorgon LNG project located off
Western Australia, the company said on Tuesday.
Chevron is the operator of the $54 billion project that has
a total of three production trains with a combined production
capacity of 15.6 million tonnes per year.
First production of the supercooled fuel from Gorgon began
in March last year, but the plant has been plagued by numerous
unplanned outages since then.
Chevron most recently suspended production at its Gorgon
Train Two production line on March 27.
"We just need to see how reliable that is," a
Singapore-based LNG trader said, referring to the plant's
troubled production history. "People learnt from previous Gorgon
and Angola trains that we need to see how stable their
The Train Three startup could add to the existing supply
glut in the Asian LNG spot market because some of the production
volumes from the new production line are not committed to
buyers, a second trading source said.
"They might do more of the prompt tenders," the source
Asian spot LNG prices LNG-AS have fallen by 45 percent
since early January to $5.40 per million British thermal units
(mmBtu) amid new production coming on stream in Australia and
the United States.
Chevron holds a controlling stake of 47.3 percent in the
project, while ExxonMobil and Shell each have a 25 percent
stake. The remaining stakes are held by Osaka Gas, Tokyo Gas and
(Reporting by Mark Tay; Editing by Richard Pullin and Christian