I am repeating myself but management does have a major issue...

I am repeating myself but management does have a major issue that is outside of its control...

I have been tempted to buy in but the port constraint stops me. Broome Port is not suitable, Derby Port is a " mickey mouse" outfit and at around 800 km distance Wyndham is too far away.I dont know enough about REY management to fully evaluate their ability, but whoever ultimately runs the operation will have insurmountable difficulty lifting export tonnage over 2 million tonnes per annum unless Point Torment is built and that is at least a number of years away.

I do however have a client who will be engaged to do work on the project this year and he has been told he will be flat out.

This article came from WA Business News

The State Government is trying to convince Japanese energy giant Inpex Corp to spend up to $750 million developing a major port at Derby to service the burgeoning Browse Basin oil and gas industry.

Premier Colin Barnett said yesterday he was "optimistic" the port project, at Point Torment near Derby, would go ahead despite challenging tidal conditions in King Sound.

"That would be a wonderful thing for Derby and would keep some of the development pressure of the oil and gas industry out of Broome so that Broome can maintain its character as a major tourist destination and not become an oil and gas town," he said.

Mr Barnett stressed that the port would be funded by the private sector, with Inpex as the first user expected to "pay the vast majority of" the cost that he estimated at $750 million.

He said State and Federal governments were likely to pay for some basic infrastructure such as roads.

The supply base is necessary to ensure development of more than $50 billion worth of oil and gas projects in the Browse Basin, led by Inpex's $25 billion Ichthys LNG venture. Other projects include the Woodside Petroleum-led Browse LNG venture, Royal Dutch Shell's Prelude floating LNG proposal and Nexus Energy's Crux liquids field, with ConocoPhillips also likely to consider a big-ticket development over the coming years.

The timing of a supply base is becoming urgent, with Inpex needing it to be operational by late 2012.

Inpex would not commit to Derby yesterday, insisting it was just one of several options it was reviewing in WA and the Northern Territory.

Darwin and Broome, with existing ports, are among Inpex's other options, although distance and space constraints are likely impediments.

It is understood that Inpex favours Derby, although sources have suggested the company's cost estimate for a basic marine supply base is substantially less than the $750 million figure touted by Mr Barnett.

Inpex' key needs are expected to be up to 50 hectares of land for lay down purposes, and a jetty.

The Broome Port Authority remains confident it will pick up some of the supply base work.

"Even if somewhere else received a guernsey, the funding would have to be quite substantial and it would take somewhere in the order of five to six years from greenfields site to where it was working and fully operational," chief executive Vic Justice said.

"In that five years somewhere has to support the Browse Basin. We already have supply bases in Broome."

Shire of Derby-West Kimberley chief executive Shane Burge said there was a need for another big port in the region. "I think the whole Kimberley would suffer if we didn't get another deep water port," he said.


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