Shell starts work on massive FLNG plant

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CANBERRA, Australia, Oct. 18 (UPI) -- A floating liquefied natural gas facility for use in Australian waters will be the largest in the world when eventually deployed, Shell announced Thursday.

Shell said it started cutting steel for production of the FLNG facility at a shipyard in South Korea. Matthias Bichsel, project and technology director for the company, explained more than 260,000 tons of steel would be used to build the facility.

The FLNG facility, dubbed Prelude, would deploy to Australian waters where it would process natural gas from multiple offshore sites into LNG for maritime delivery. The company said production and deployment was a multiyear process.

Liquefied natural gas can be delivered to more diverse markets than conventional gas, which requires pipelines that sometimes pass through politically sensitive or dangerous territory.

Shell expects the demand for natural gas to double by 2030. LNG demand could double within 10 years.

The company said it aims to spend $30 billion during the next five years in Australia.

As of 2010, Australia was the fourth-largest exporter of LNG in the world. The country holds an estimated 110 trillion cubic feet of proven natural gas reserves.