Dec 5 Chevron Corp added $15 billion to the cost of the Gorgon liquefied natural gas (LNG) export complex, as the U.S. oil company's largest single development joins a growing list of Australian LNG projects to run over budget.
The new $52 billion estimate for Gorgon, now 55 percent complete, came on Wednesday alongside Chevron's $36.7 billion overall 2013 budget for capital and exploratory spending. That compares with a 2012 budget of $32.7 billion, and is just shy of the $37 billion annual budget of far-larger Exxon Mobil Corp .
Like other Australian LNG projects, Gorgon's inflated cost is largely due to labor shortages, logistics challenges and the strength of the local currency. Half of the six other LNG plants being built in the country have sustained cost increases averaging more than 20 percent.