Reuters: Chevron Lowers Gorgon LNG Prices

Chevron Corp is sweetening its sales pitch to attract new buyers to the under-booked $54 billion Gorgon liquefied natural gas export plant off northwest Australia, hit by high costs as fuel prices and demand plunge.

The move is a departure for Chevron which has for years stuck to its ambitious asking prices, industry sources say, only yielding as global liquefied natural gas (LNG) demand slumped and new supply gave buyers cheaper alternatives.

Production at the giant 15.6 million-tonnes-a-year plant is due to begin within weeks.

"Lousy" is how Chevron Chief Executive Officer John Watson last week described the global LNG market which Gorgon - the world's most expensive such venture - will sell into.

Chevron faces a unique double-blow from record growth in gas supplies from Australia and the United States and from battered crude oil markets pushing current LNG prices below Gorgon's high cost of production, according to analysts. MORE