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Liquified gas plants will be needed to tap Australia's hidden treasures. 22 Special Topic – Energy An estimated 129 billion cubic meters of natural gas are hidden below the ocean some 190 kilometers northwest of Dampier. Indian Ocean Dampier Carnarvon Perth With the help of AGCS experts in London, the Australian branch of Allianz Corporate & Specialty (AGCS) secured its role as lead insurer for the onshore production facilities, gas tanks and jetty. “That was a real milestone for us,” says Ronan Gallagher, who heads the AGCS team in Sydney. A milestone that is also paying off: so far, there have been no major accidents or damages since the project got underway – despite the daunting technical and geological challenges. The specific conditions in the Carnarvon Basin off the north coast of Western Australia required extensive exploration of the seabed to develop a safe anchorage at a depth of 85 meters for the offshore platform on which the gas is collected from the five drilling wells. Engineers also had to carefully consider the course of the 180-kilometer long pipeline to the onshore LNG plant and how best to stabilize it. The gas field is exposed not only to strong tidal and sediment movements but also to unpredictable oceanic currents. Production forecasts appear to justify the outlay. Experts are predicting a threefold increase in global demand for LNG by 2025. Asia’s energy appetite in particular is driving prospects, and Australia’s geographical location puts it in an excellent position. If fully exploited, Pluto could yield a good 12 million metric tons of LNG a year in Broome WESTERN AUSTRALIA RONAN GALLAGHER AGCS Pacific Head of Engineering Underwriting ronan.gallagher@allianz.com.au Great Australian Bight future: The 200 hectare LNG Park on Burrup Peninsula, which is insured by AGCS, can easily accommodate a further four processing plants. “Australia's ‘dash for gas’ presents us with some great opportunities and challenges,“ says Gallagher. “The stakes are high with a very high concentration of values.” But Pluto is not the only source that Australia is staking its hopes on: the Gorgon gas field to its south, is set to come on stream in 2014, and will trump everything that has come before. Containing over 1,100 billion cubic meters of gas, almost ten times as much as the Pluto field, it would be sufficient to power a city of a million inhabitants for 800 years. Chevron, ExxonMobil and Shell are jointly investing A$ 43 billion (€ 30 billion) in the development work. A floating LNG plant will be tested here for the first time. PetroChina has recently agreed to purchase 2.25 million metric tons a year. This agreement alone will earn the Gorgon operators A$ 50 billion (€ 35 billion) over a period of 20 years. WWW.WOODSIDE.COM.AU WWW.AGCS.ALLIANZ.COM/SERVICES/ENGINEERING/ NORTHERN TERRITORY SOUTH AUSTRALIA Adelaide GAS GIANT Australia is thought to have one of the largest natural gas reserves in the world. Together with New Zealand, net annual exports are expected by the International Energy Agency to grow from 10 billion cubic meters in 2007 to 67 billion by 2035. Special Topic – Energy 23
SPECIAL TOPIC Wind energy Offshore wind farms – pion eering work on the high seas A stormy day on the North Sea. A large ship gets into trouble. The high swells hurl it against the transformer platform of an offshore wind farm, sinking it. Power from the wind farm to the mainland is cut off for months. A worst case scenario. MARIA WAGNER A total loss with far-reaching consequences: The electricity can no longer be transmitted, and the wind energy production must be shut down. Perhaps for a period of months. After all, it can take an extensive amount of time to erect a new platform on the high seas: Elaborate advance work must be done to schedule the use of costly special ships and equipment. The high-seas operation may be delayed over and over again as a result of bad weather. Added to the high production costs of a new offshore platform are the financial losses resulting from the extended halt of electricity production. “When an entire platform sinks into the sea, we face a classic worst case scenario. In such cases, we are talking about potential property losses of € 50 million to € 60 million as well as a nine-digit loss of income,” says Gerhard Müller, Senior Risk Consultant 24 Special Topic – Energy at Allianz Global Corporate & Specialty (AGCS). Gerhard Müller knows what he is talking about: Every day he works on risk management in the area of wind power stations. The market for these systems is currently experi encing a boom. Germany is a good example. The Amended Renewable Energies Act of 2009 has set very ambitious goals for the country: By 2020, 30 percent of electricity should come from renewable energies. Robert Maurer, Global Head of Renew able Energies Underwriting at AGCS, is convinced that wind power will play a key role in this drive: “Wind power stations represent a real alternative to nuclear power plants because they can produce sufficient amounts of electricity. For this reason, wind energy has the greatest potential of all re newable energies – particularly from a cost-benefit perspective.” Wind power worldwide June 2010 With almost all lucrative mainland sites occupied, European wind farms are moving farther out to sea. Position Country Total capacity June 2010 (MW) Added capacity June 2010 (MW) Total capacity end 2009 (MW) 1 USA 36,300 1,200 35,159 2 China 33,800 7,800 26,010 3 Germany 26,400 660 25,777 4 Spain 19,500 400 19,149 5 India 12,100 1,200 10,925 6 Italy 5,300 450 4,850 7 France 5,000 500 4,521 8 United Kingdom 4,600 500 4,092 9 Portugal 3,800 230 3,535 10 Denmark 3,700 190 3,497 Rest of the World 24,500 2,870 21,698 Total 175,000 16,000 159,213 Source: WWEA Special Topic – Energy 25
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