BHP Billiton approves 520m-dollar investment for Australian plant

Diversified resources giant BHP Billiton has given the green light for a half-a-billion-dollar investment in its Longford Gas Conditioning Plant (LGCP) project in Australia, necessary to its production plans.

The company announced on Thursday the approval for a $520m investment in the PGCP project as part of the Gippsland Basin Joint Venture in Victoria with Esso Australia Resources Pty (operator). Each company owns a 50% interest in the partnership.

"The LGCP is a necessary extension of Bass Strait infrastructure to enable valuable hydrocarbon liquids production and domestic gas supply for years to come," said J Michael Yeager, the Chief Executive of BHP's Petroleum division.

Start your trial of MoneyWeek today

Get unparalleled financial insight, analysis and expert opinion you can profit from.

Start your trial

Sign up for MoneyWeek’s free twice-daily newsletter.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.

Sign up

The new conditioning plant will add carbon dioxide removal capacity to the Longford Gas Plant, which is necessary to condition production from the Turrum offshore development project.

It will process around 400m standard cubic feet of gas per day and will cut CO2 content of treated gas to less than 3%.

BHP said that saleable gas production will start in 2016.