Barossa FID to spark $5.5b northern investment
The final investment decision (FID) to proceed with Barossa also kick-starts a $785 million investment in the Darwin LNG life extension and pipeline tie-in projects, which will extend the facility life for around 20 years.
The Barossa project and Darwin LNG life extension are expected to create 600 jobs throughout the construction phase and secure 350 jobs for the next 20 years of production at the Darwin LNG facility.
Santos describes Barossa as one of the lowest cost, new LNG supply projects in the world and says it will give Santos and Darwin LNG a competitive advantage in a tightening global LNG market.
The project represents the biggest investment in Australia’s oil and gas sector since 2012.
Santos managing director and chief executive officer Kevin Gallagher said FID on Barossa was consistent with Santos’ strategy for disciplined growth utilising existing infrastructure around the company’s core assets.
“Our strategy to grow around our five core asset hubs has not changed since 2016. As we enter this next growth phase, we will remain disciplined in managing our major project costs, consistent with our low-cost operating model,” Mr Gallagher said.
“As the economy re-emerges from the COVID-19 lockdowns, these job-creating and sustaining projects are critical for Australia, also unlocking new business opportunities and export income for the nation.
“The Barossa and Darwin life extension projects are good for the economy and good for local jobs and business opportunities in the Northern Territory.”
The move comes less than a year since Santos completed the acquisition of ConocoPhillips’ northern Australia and Timor-Leste assets.
“I am delighted to welcome our Barossa joint venture partner SK E&S as a partner in Bayu-Undan and Darwin LNG and appreciate their support for today’s Barossa development decision,” Mr Gallagher said.
The Barossa development will comprise a Floating Production, Storage and Offloading vessel, subsea production wells, supporting subsea infrastructure and a gas export pipeline tied into the existing Bayu-Undan to Darwin LNG pipeline.
First gas production is targeted for the first half of 2025.
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