The Gorgon project in Australia will be even larger than expected, with Chevron Corporation (NYSE:CVX) adding additional capacity to this massive liquefied natural gas (LNG) project.

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Overview
The Greater Gorgon project is 47% owned and operated by Chevron, with ExxonMobil (NYSE:XOM) and Royal Dutch Shell (NYSE:RDS.A, RDS.B) each owning a 25% interest in this project. Osaka Gas, Tokyo Gas and Chubu Electric Company also own minor shares of Gorgon.

The Gorgon Project originally involved the development of the Gorgon and Jansz-Io natural gas fields located off the coast of northwest Australia. The natural gas will be transported to Barrow Island where Chevron and its partners planned to construct a three-train liquefied natural gas (LNG) facility with an annual capacity of 15 million tons.

Chevron will also build a natural gas processing facility here, with a capacity of 280 million cubic feet of natural gas per day. This output will be transported by pipeline to Australia for consumption by its domestic market. The company expects the project to cost between $37 billion and $43 billion and estimates that initial production from the Gorgon project will begin in 2014.

SEE: A Guide To Investing In Oil Markets

Expansion
Chevron now plans to add a fourth LNG train to the Gorgon Project, increasing its total capacity to 20 million tons per year. The company will develop the Geryon and Chandon fields to provide a supply of natural gas for this expansion. Chevron still needs to obtain regulatory approval for the fourth LNG train, which is expected to add an additional $10 billion to the cost of the Gorgon project.

Wheatstone
The Gorgon project is not the only LNG facility that Chevron is involved with in Australia. The company is also working on the Wheatstone LNG project, located in the same general area as Gorgon. Wheatstone involves the development of four offshore natural gas fields and the construction of a two-train LNG facility on the Australian mainland. The facility will have a capacity of 8.9 million tons per year and will also supply natural gas to the domestic market.

Wheatstone is operated and 72.14% owned by Chevron, with Royal Dutch Shell and Apache Corporation (NYSE:APA) having a 6.4% and 13% ownership interest in the project, respectively.

SEE: Oil And Gas Industry Primer

Other LNG Projects
Several LNG projects are under construction or being planned in the United States as the industry looks to deal with the oversupply of natural gas. Cheniere Energy (NYSE:LNG) and Cheniere Energy Partners, L.P. (NYSE:CQP) recently received final approval to build a four-train LNG export plant at an existing facility in Louisiana. The company initiated construction in August 2012 and expects this project to start up in 2015.

Sempra Energy (NYSE:SRE) also plans to build a LNG export facility in Louisiana and expects to start construction in 2013, with a planned start up in 2016. The Cameron LNG project will have a three-train liquefaction plant with an annual capacity of 12 million tons.

The Bottom Line
Chevron Corporation plans to add an additional LNG train to the Gorgon project in Australia and will also develop two additional offshore fields to supply natural gas to this project. This planned LNG facility and expansion is one of many that the company has under construction or in the planning stage.

At the time of writing, Eric Fox did not own shares in any of the companies mentioned in this article.

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