PERTH (miningweekly.com) – First production from the Scarborough gasfield has been targeted for 2026, Australian oil and gas producer Woodside said on Wednesday.
Speaking at an investor briefing, CEO Peter Coleman said that the deferral in March this year of final investment decisions on Scarborough and Pluto Train 2 allowed the project teams to seize the day, extracting additional value by potentially increasing the offshore capacity and optimising the development schedule.
“Scarborough is a globally competitive development which has the potential to be a game-changer for Woodside, producing net cash flow of around $35-billion over its field life.
“We estimate the targeted 20% increase in Scarborough’s upstream capacity can be achieved at a very modest capex, with virtually no cost impact on the downstream,” Coleman noted.
“In terms of both contractor availability and the external liquefied natural gas (LNG) market, we expect the timing to be right for final investment decisions on Scarborough and Pluto Train 2 in the second half of 2021. The Scarborough joint venture (JV) is aligned on this schedule, which would put us on track for first LNG in 2026.
“We also remain aligned with our JV partners on the development of Browse as backfill to the North West Shelf. Work is continuing to move Browse towards the front-end engineering design phase, with a final investment decision targeted from 2023.
Woodside in January this year reported a 52% increase in the resource volume at the Scarborough field, from 7.3-trillion cubic feet to 11.1-trillion cubic feet.
Federal Resource Minister Keith Pitt this week said that the development of the Scarborough gasfield, through the expansion of the Pluto LNG facility, is expected to create more than 3 200 jobs during the construction phase, and an average of more than 1 300 jobs a year during operations,.
“The project will also help maintain Australia’s position as one of the world’s largest LNG producers whilst contributing to domestic gas supply and supporting our economy,” the Minister said.
“The production licences account for 11.1-trillion cubic feet of gas resources and they support the government’s plans for a gas-fired economic recovery.”
Pitt said the government was pleased to see the project’s engineering, commercial and regulatory work was well advanced.
“Investments in gas and other Australian resources projects have been the main driver of the Australian economy in recent decades. Progress on the Scarborough project is another show of confidence in the long-term future of Australia’s resources sector and resources jobs.”
Meanwhile, Coleman noted that Woodside was also making progress at its Sangomar field development offshore Senegal, and expected to complete the acquisition of JV partner Cairn’s interest in the JV before the end of the year.
“Sangomar is an attractive, de-risked asset and, as previously flagged, we are looking to sell down our equity to the right partner at the right price over the course of 2021,” Coleman said.