The Ichthys LNG Project
INPEX has begun construction of one of the world's largest oil and gas projects following the Final Investment Decision (FID) on the US $34 Billion Ichthys LNG Project in Australia on 13 January 2012. The Ichthys LNG Project is a joint venture between INPEX (Operator) and Total with Tokyo Gas, Osaka Gas, Chubu Electric and Toho Gas.
The Ichthys Field is situated in the Timor Sea approximately 200 kilometers off the Western Australian coast and over 800 kilometers from Darwin. Three exploratory wells drilled in 2000 and 2001 resulted in the discovery of an extremely promising gas and condensate field with resource estimates from two reservoirs totaling approximately 12TCF of gas and 500 million barrels of condensate. Conceptual studies, FEED and ITT followed and development leading to sanctioning of the Ichthys LNG Project by INPEX and Total.
Gas from the Ichthys Gas-Condensate Field in the Browse Basin will undergo preliminary processing offshore to remove water and extract condensate. The gas will then be exported to onshore processing facilities in Darwin via an 889 kilometer subsea Gas Export Pipeline (GEP). Most condensate will be sent to a Floating Production Storage and Offloading (FPSO) vessel for stabilization and storage prior to being shipped to global markets. The Ichthys LNG Project is expected to produce 8.4 million tons of LNG and 1.6 million tons of LPG per annum, along with approximately 100,000 barrels of condensate per day at peak.
Production from 20 subsea wells in the first phase - 50 will be drilled in total - will be sent to the Central Processing Facility via 8?? rigid lines connected to flexible risers. The flexibles will be supported by a 110 meter high jacket type riser support structure. You see, no aspect of the Ichthys LNG Project is small.
Effluents will be separated on the Central Processing Facility (CPF), a semi-submersible floater. Gas will be dried and compressed prior to being sent ashore via a GEP. Compression will be from four compressors, designed for 590.7 MMSCFD. Following initial treatment, most liquids will be transferred from the CPF to the nearby FPSO for processing and storage. The 330 meter-long FPSO will be a weather-vaning ship-shaped vessel that is permanently moored on a non-disconnectable turret. It has been designed with a storage capacity of nearly 1.2 million barrels. Loading of two offtake tankers in tandem will be possible from the FPSO.
In a world where perception is reality it is crucial for oil & gas companies to maintain transparent and constructive relationships with their stakeholders. To ensure business continuity companies must build strategies that are centered on respect, listening, dialogue and stakeholder involvement. This has come to be known as establishing a "social license to operate.??
With this in mind, and with the help of the Altermondo consultancy, Total developed the SRM+ tool in 2006. This is a methodology by which an entity (a project group, a subsidiary) compares its internal vision of the societal context in which it operates with the perception of its external stakeholders and builds action plans aimed at bridging the gaps between them.
In 2011 the Ichthys LNG Project in Australia, a Joint Venture between INPEX (operator) and Total, applied the SRM+ tool. A total of 35 external stakeholder groups were interviewed, from the Northern Territory, Western Australia and the Australian Capital Territory.
Although most stakeholders stated they were very satisfied with the quality of their relationship with INPEX and the Ichthys Project, several valuable suggestions were made on how to improve the dialogue and strengthen relationships. The SRM+ process provided valuable insights that are difficult to glean from routine interaction with stakeholders. It also gave confidence to the Project managers that they understand the issues, concerns and expectations of key stakeholders and that external risks are being appropriately managed.
Following the SRM+ engagement, several Project managers made adjustments to their strategies. Possibly the most important outcome of SRM+ was that it has created the foundation for the Ichthys Project's long-term approach to stakeholder engagement. Going forward, INPEX plans to build on the SRM+ process by developing and deploying a stakeholder relationship management software package for the Ichthys Project that will enable the organization to identify, manage and respond to issues of importance to its stakeholders. Doing so will ensure that the Ichthys Project is able to maintain its social license to operate.
Oil & Gas companies dedicate considerable budgets to CSR programs. It is essential that these are developed taking the views and concerns of stakeholders into consideration to guarantee their effectiveness and sustainability. Therefore, engaging with stakeholders is vital to success and companies must provide their stakeholders with both the opportunity and the means to present their views and voice their concerns.
This paper addresses through the practical example of the implementation of SRM+ on the Ichthys LNG Project, some of the key questions companies face when defining and implementing a CSR strategy.
The SRM+ approach is based on the assumption that soliciting stakeholders' views of, and concerns about, a company's activities is best achieved through open, guided discussions. One way interviews can be restrictive.