Shell Plc (SHEL)

[OilStockReport]

Shell's new natural gas method.

Royal Dutch Shell (NYSE: RDS.A) is developing a new technology for use in Australia. So far, the company has spent $500 million and 15 years’ worth of research on its development.

This breakthrough – floating liquefied natural gas terminals – will enable Shell to recover natural gas from offshore fields that were previously considered uneconomical to develop. As mentioned in David’s article, much of Australia’s gas lies buried in offshore fields.

Shell’s Floating Liquefied Natural Gas (FLNG) Prelude facility is certainly impressive.

It’ll be the world’s largest offshore facility, at 600,000 tons and six times larger than the largest aircraft carrier.
Prelude will begin service in 2016, moored approximately 125 miles off the coast of northwestern Australia, atop a major gas field in the Browse Basin.
Shell’s general manager for FLNG, Neil Gilmour, says that the gas field contains more than 100,000 billion cubic feet of discovered, but undeveloped, gas. This is an astronomical number, and is equivalent to about five times U.S. annual natural gas consumption.

Shell believes that the Prelude field is just one of a number of giant offshore gas fields around the globe, waiting to be tapped by the right technology.

Shell estimates that globally, nearly 300,000 billion cubic feet of natural gas is sitting offshore. The company says this is an extremely conservative estimate, which excludes small- and mid-sized fields, and fields that could exist in the polar regions.