BG's plans to expand put back four years THE new head of British gas giant BG Group says any expansion of the $US20 billion ($20bn) Queensland Curtis LNG project at Gladstone is now four years away and has fallen behind projects in the US and Tanzania as growth options for the company. In his first strategy presentation since taking over from Frank Chapman at the start of the year, BG chief executive Chris Finlayson pushed back the priority of expansion in Australia. He said ramping up the QCLNG foundation project was one of the firm's biggest risks to hitting 2015 production guidance, and added he might be keen to further cull BG's stake in the project. The delay of a Queensland LNG expansion comes as gas export proponents find it too expensive or too hard to sign off on new projects here, leading them to focus more on other regions such as the US and Tanzania. Sir Frank had targeted a 2012 approval of a third LNG production unit, or train, at Gladstone, to follow on from the two trains under construction and due to start exporting next year. When this target was not hit amid rising local construction costs and rains and increased Queensland regulations, which slowed the pace of onshore coal-seam gas exploration, the expansion was named as one of three LNG growth options, along with an LNG plant in Tanzania and the Lake Charles project in the US. Last night Mr Finlayson told investors the QCLNG expansion was likely to be approved after the other two options. "There is good potential to expand QCLNG with a third train" through shoring up resources in the Bowen and Surat Basins in Queensland and the Cooper Basin in South Australia, he said. "This is a two or three-year program to identify the best option to feed train three," he said, adding the company would look at shoring up unconventional gas in the Cooper Basin of SA as well as its CSG options in the Bowen Basin. A presentation slide showed Australian options were about four years away from sanction, while Lake Charles and Tanzania were about three years away. "We may not take them (the three projects) all to sanction or participate in all of them at current levels," Mr Finlayson said. We will bring in partners and look for more opportunities to lower our capital contributions. It is believed increased Queensland regulation of CSG drilling is the biggest cause of the delays. There are concerns the three big LNG projects being built at Gladstone will struggle to produce enough CSG to feed the big plants in their early years. At the same time, cost blowouts at all the approved projects have led the Arrow joint venture (owned by Shell and PetroChina) to flag teaming up with other projects instead of building a fourth project. The BG delay adds ammunition to oil and gas industry concerns over Labor's budget measures on exploration deductions, thin capitalisation and acreage options. "The (budget) decisions continue the recent trend of fiscal and regulatory changes that reduce investor confidence and our global competitiveness," Australian Petroleum Production and Exploration Association chief executive David Byers said.