Shell Begins Construction On Floating LNG Project

Royal Dutch Shell PLC RDS.A +1.16% said Thursday that major construction had begun on the world’s first floating vessel that will new technology to produce liquefied natural gas aboard.

The oil multinational said it had begun the cutting of the first steel for the Prelude floating liquefied natural gas, or FLNG, facility that will develop gas fields 200 kilometers off the coast of Australia.

“We are cutting 7.6 (metric) tons of steel for the Prelude floating liquefied natural gas facility today, but in total more than 260,000 tons of steel will be fabricated and assembled for the facility,” said Shell’s Projects and Technology Director Matthias Bichsel.

The completed Prelude FLNG facility will be 488 meters long and 74 meters wide, making it the largest offshore floating facility ever built, Shell said. It will produce gas at sea, turn it into liquefied natural gas and then transfer it directly to ships that will transport it to customers.

At peak levels, around 5,000 people will be working on the construction of the FLNG facility in South Korea and another 1,000 will build the turret mooring system, subsea and wells equipment in other locations across the globe, Shell said.

A pioneer of FLNG technology, Shell is targeting first production in 2016.

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