Shell has taken a final investment decision (FID) to develop the first phase of Arrow Energy’s AUD10bn (US$6.4bn) Surat Gas Project in Queensland (Australia), which would bring up to 90 bcf/year (2.5 bcm/year) of new gas to market at peak production. The project is being developed by a 50-50 joint venture between Shell and PetroChina named Arrow Energy and will feed Shell’s affiliate QGC, which operate the 8.5 Mt/year Queensland Curtis LNG plant on Curtis Island. Construction of the Surat gas project will start in 2020 and its first gas sales are expected in 2021.
In December 2017, Arrow Energy signed a 27-year deal to supply Shell's Curtis LNG liquefaction project QGC. The deal enables Arrow Energy to commercialise the majority of its gas reserves (5 Tcf or 141 bcm) in the Surat Basin. QGC has a capacity of 8.5 Mt/year over two trains commissioned in 2014 and 2015. The plant currently processes coal seam gas produced from the Surat and Bowen basins by Australia Pacific LNG (APLNG), a joint venture of ConocoPhillips (37.5%), Origin Energy Limited (37.5%) and Sinopec (25%). The LNG is mainly sold through two 20-year contracts to CNOOC and to Energy Market Authority of Singapore.