WSJ - Onshore LNG "increasingly difficult to build"
July 24, 2012, 11:12 p.m. ET
Australia Has Highest LNG Cost Base in the World -Shell Exec
PERTH--Royal Dutch Shell PLC's (RDSA) top Australian executive said Wednesday that rising construction and labor costs in the country may threaten new investment in the expanding liquefied natural gas sector.
The Australian LNG industry has "probably the highest cost base now" anywhere in the world, Shell Australia Chairman Ann Pickard told an industry conference.
Some of the costs are due to the high dollar, but Australia also needs to look at the "broader investment conditions" for companies like Shell, she said.
"If we can't keep the prices down and we can't find a way to improve the productivity, onshore LNG plans will become increasingly difficult to build," she added.
Shell is building its Prelude floating LNG facility offshore Western Australia, and also owns 25% of the Chevron Corp. operated Gorgon development.
=========== IMO, IOC missed it's window if it indeed ever had one. Think Australia cost structure is getting high? PNG is nearly devoid of decent infrastructure, has virtually no skilled labor, and would have undetermined security costs associated with any project.