Chevron Corp. said it has completed more than a fifth of the construction at the $37 billion Gorgon liquefied natural gas project off northwest Australia and aims to approve an expansion in late 2013.

Chevron, the second-largest U.S. energy company, plans to lodge documents detailing the expected environmental impact of a fourth LNG processing unit, or train, later this year, Colin Beckett, general manager of the Gorgon project, said in an interview. The company and its partners, including Exxon Mobil Corp. and Royal Dutch Shell Plc, plan to produce 15 million metric tons of LNG a year from three units starting in 2014.

"We've started work on expansion, with a small project team already formed here in Perth," said Beckett, who is attending an oil and gas industry conference in the Western Australian city. "Towards the end of 2013 is a reasonable target to aim for. We want to capture the synergies from the first three trains. There's a lot we can leverage off."

Chevron is among energy companies proceeding with Australian LNG ventures to meet a projected increase in Asian demand for cleaner-burning alternatives to coal. The oil producer has called the Gorgon and proposed Wheatstone LNG project in Australia the "centerpieces" of its growth plans.

There may be "a bit of a gap after the fourth train," and before a potential fifth processing unit is approved, he said

David Fuller's view Natural gas has many attractions as a fuel but chief among them is that it is cheap relative to oil and even coal. Veteran subscribers will be familiar with our contention that unconventional oil and natural gas are game changers for the energy sector. Shale gas has so far helped to contain prices pressures in US supply. As additional supply comes online, the long-term outlook for energy supply looks sanguine.

Transportation has always been an obstacle to a global market for natural gas but this is changing with the expansion of LNG terminals and shipping. Major oil companies such as Exxon Mobil and Shell both now produce more gas than oil on an energy equivalency basis. Taken together these points indicate that supply, transport, availability and relative pricing are all supportive of a healthy long-term future for LNG producers.

Brent oil prices have rallied impressively over the last year and are now quite overextended relative to the 200-day MA. While prices have pulled back sharply over the last two days a sustained move below the $110 -115 area would be required to break the progression of higher reaction lows and suggest that a peak of medium-term significance has been reached. Such high oil prices ensure that the search for an alternative energy source is never very far from the minds of governments and consumers.

Chevron has risen even faster than the oil price over the last few months and is also overextended relative to its MA. The 2008 peak near $100 may now offer an area of potential support and a sustained move the 200-day MA, currently $90 would be required to check medium-term upside potential.

BG Group is not as overextended as Chevron above. It broke upwards to new highs in February and the area near 1400p may also offer an area of potential support in the event of a reversion towards the mean.

Origin Energy has been ranging mostly below A$118 since late 2008 and a sustained move above that level would reaffirm the medium-term uptrend. AGL Resources has been ranging below A$40 since June and is currently retesting that area. A sustained move above it would indicate a return to medium-term demand dominance.

This Performance Filter of other Australian natural gas companies illustrates that the sector has more generally been ranging with a downward bias.