LNG

Santos, the Australian operator of the Gladstone liquefied natural gas plant in Queensland and a stakeholder in export plants in Darwin and Papua New Guinea, posted record quarterly LNG revenue as its annual income from the fuel jumped more than 23 percent and a total of 232 cargoes departed from the three facilities.

Santos said in its quarterly activities report that total LNG sales revenue for 2018 amounted to US$1.45 billion versus US$1.17Bln in 2017.

Record overall quarterly sales revenue, including oil and other products, rose by 7 percent to US$1.04Bl, including record quarterly LNG sales revenue of US$449 million, up 39 percent compared with the US$323M reported in the same 2017 quarter and 11 percent on the previous quarter’s US$405M.

The company said its annual realised LNG price was US$9.91 per million British thermal units compared with US$7.31 per MMBtu in 2017.

Fourth-quarter LNG volumes were sold at an average of US$10.96 per MMBtu versus $US10.43 in the previous quarter.

Fourth-quarter production of all products was higher than the prior quarter due primarily to the completion of the of acquisition of Australian company Quadrant Energy on November 27, partially offset by completion of the sale of Santos’s non-core Asian asset portfolio in September 2018.

Quarterly LNG cargoes shipped from Gladstone LNG on Curtis Island, whose other shareholders are Petronas of Malaysia, France’s Total and Korea Gas Corp., amounted to 20 cargoes and 80 shipments for the year compared with 89 in 2017.

“LNG production was lower than the prior year primarily due to the GLNG joint venture partners diverting about 40 PJ of gas (1 billion cubic metres) to the domestic market,” said Adelaide-based Santos.

“The diverted gas, originally slated for export cargoes and equivalent to 700,000 tonnes of LNG, was sold to East Coast domestic customers,” added the company.

Santos also noted that a record 305 coal-seam gas wells were drilled for GLNG in 2018, up 77 percent from the previous year and the wells are likely to number 350-400 in 2019.

Quarterly LNG cargoes shipped from PNG LNG, operated by US major ExxonMobil, amounted to 30 in the last three months of the year and 98 for all of 2018. The number of PNG shipments that departed in 2017 was 110.

“The LNG plant operated at an annualised rate of 8.7 million tonnes per annum during the fourth quarter and achieved daily rates in excess of 9 MTPA annualised.

Annual production in 2018 was, however, lower than the prior year primarily due to the impact of a severe earthquake in the first half,” Santos explained.

“Santos along with the other PNG LNG parties and the Papua LNG Joint Venture are also continuing discussions to build alignment for the proposed construction of three additional LNG Trains at the PNG LNG site, with two Trains to process gas from the Papua LNG project and one Train for the proposed PNG LNG expansion,” added the company.

The Darwin LNG plant, operated in the Northern Territory by ConocoPhillips, shipped 16 cargoes in the quarter and 54 for the year, mainly to Japanese customers.

Santos said that as regards Darwin LNG, detailed engineering design for the offshore Barossa gas development is being advanced across a number of fronts with a final investment decision targeted towards the end of 2019.

“The successful development of Barossa would extend the operating life of Darwin LNG for more than 20 years,” stated Santos.