LNG

Santos CEO Kevin Gallagher has indicated a “significant” part of the multi-billion Papua LNG development will be funded by project financing, backed by the strong performance of the nearby PNG LNG project, whose debt was repaid six months ahead of schedule.

July 18 (LNGJ) - Australian LNG operator Santos said LNG sales revenues in the second quarter dropped to US$762 million from US$838M in the prior-year quarter. Santos added that 22 LNG cargoes were shipped during the three months from the Gladstone LNG export plant in Queensland. However, no LNG cargoes were delivered from the Darwin LNG plant as the Bayu-Undan feed-gas field continues to deplete and volumes were being sent into the Australian Northern Territory market.

   “The Barossa gas project to backfill the Darwin LNG plant is 77 percent complete,” said the company. Santos added that a further 27 cargoes were exported from the Papua New Guinea liquefaction plant where the Adelaide-based company is a shareholder. Santos also noted that the company’s Moomba carbon-capture and sequestration project in south Australia was being commissioned and was on schedule for first injections of CO2 this year.

Japanese liquefied natural gas imports increased marginally in June even at higher prices, though the half-year figures showed a downward trend for 2024.

New Zealand has reversed a ban on oil and gas exploration introduced by the previous government and will offer incentives for energy and mining company investments similar to those in other pro-fossil fuel energy nations.

Santos Ltd, the Australian operator of two liquefied natural gas export plants and a main shareholder in Papua New Guinea LNG assets, has signed a long-term supply deal with Hokkaido Gas Co., the Japanese utility.

Santos, the Australian LNG operator and owner of assets in Papua New Guinea, said it would continue to work through land access, native title, pipeline licensing and the environmental approvals processes to get Narrabri Gas volumes and the Hunter Gas Pipeline ready for a final investment decision and to provide supplies for the East Coast of Australia.

The Narrabri Gas Project is 100 percent committed to the domestic market and could supply up to 50 percent of the natural gas needs of New South Wales.

Santos has maintained that gas produced close to market will always have a cost advantage over gas imported from Western Australia or from overseas and would help to put downward pressure on domestic gas and energy prices for NSW customers.

Gladstone LNG plant operator Santos, based in Adelaide, is developing its own domestic gas volumes called the Narrabri project in NSW and which would supply the largest Australian city Sydney.

The Narrabri project is a coal-seam gas venture located near the state border between Queensland and NSW.

The venture is based on developing the CSG in the northwest of NSW with up to 850 wells and which Santos has always pointed out would be much less expensive than gas from anywhere else.

LNG interests

Santos also operates the Darwin LNG in the Northern Territory of Australia. It additionally has stakes in the Papua New Guinea LNG export plant operated by US major ExxonMobil Corp. and in the expansion project called Papua LNG.

“Santos notes the decision by the Full Federal Court to allow the appeal against the determination by the National Native Title Tribunal that proposed future acts, being the grants of Petroleum Production Lease Application Numbers 13, 14, 15 and 16 for the Narrabri Gas Project, may be done,” said Santos.

“The Court has determined the National Native Title Tribunal erred at law by declining to have regard to evidence on climate impacts that was tendered on behalf of the Gomeroi applicant,” it added.

“The Court did not make any findings in relation to Santos’ conduct. Santos has at all times negotiated with the Gomeroi people in good faith,” it stated.

Santos the attempted to explain that the Court’s orders regarding next steps are yet to be made.

“Santos will continue to engage constructively with the Gomeroi people and work closely with them to ensure their heritage is protected,” the company said.

Santos also hopes that they benefit from the project development, including through training and employment, and involvement in all aspects of cultural heritage protection and management.

While gas is going to be required for decades to come in Europe, the Asia-Pacific region and North Asia, corporate investment in more supply is the only way to ensure reliability and affordability of energy while making the system cleaner. 

Feb 26 (LNGJ) - Santos, the Australian and Papua New Guinea LNG plant shareholder and operator, has secured finance for the company’s share of the US$220 million Moomba carbon-capture and storage (CCS) project in South Australia. The facilities, arranged over five years and totalling US$150M, will be used to cover project costs incurred to date and to use as the project progresses to the first carbon injection targeted for mid-2024.

   Santos said the willingness of banks to fund energy transition projects at very competitive rates indicated their recognition of CCS as a vital tool to control carbon. “The strong support Santos has received is underpinned by the progress we are making focused on reducing our own emissions and those of our customers, as well as on developing low-carbon fuels as customer demand evolves,” said Santos Chief Executive Kevin Gallagher.

Australia’s largest liquefied natural gas companies Woodside Energy and Santos have ended their merger discussions after failing to agree terms for creating a A$88 billion (US$58Bln) LNG mega-company in the Southern Hemisphere.

Feb 1 (LNGJ) - Australian LNG developer Santos has agreed to an amendment to a sale agreement with Papua New Guinea company Kumul Petroleum Holdings whereby Kumul will take a 2.6 percent shareholding in the PNG LNG stake owned by Santos.

   Santos said that Kumul had paid US$352 million to Santos on 31 January 2024 to allow partial completion of the transaction. “The amendment provides additional time for Kumul to pay the remaining purchase price of US$241M,” added Adelaide-based Santos.

Woodside Energy, the operator of the North West Shelf plant and Pluto LNG in Western Australia and still considering a merger with Australia’s Santos, said it welcomed an opportunity offered to contribute to the Australian Government’s development of a future gas strategy.

The Perth-based company said that with more than 200 submissions made to a consultation process undertaken by the Australian Department of Industry, Science and Resources (DISR), there was a growing recognition of the “pivotal role of gas” at a time when access to secure, affordable and reliable energy supply is becoming increasingly challenging.

“As many submissions identified, gas will play a key role in a responsible energy transition,” said Woodside.

“This was acknowledged by local and state governments, manufacturers, regional customers, power generators, think tanks and policy experts, business and industry groups and unions,” the company added.

Woodside explained that it supported the main objectives of the government strategy and saw them as interrelated goals.

Objectives

The objectives are: providing affordable and reliable energy for Australians; maintaining strategic partnerships and energy security in the region; and simultaneously progressing decarbonisation of trading partners and decarbonisation in Australia.

“Australia has the natural resources to support both the renewable and non-renewable energy developments which will be needed as populations increase and energy consumption rises,” explained Woodside.

“These natural endowments provide Australia with an opportunity to be a regional and global leader in the energy transition,” it added.

However, Woodside said that to achieve these goals the country needed policy settings that would embrace the opportunities presented by a strong Australian gas industry.

“The industry needs fiscal and regulatory stability if it is to continue to take investment risks and develop Australia’s resources,” Woodside declared.

“Government must also provide certainty to workers and businesses, including the Australian manufacturing sector, on the medium-term and long-term role of gas so they can make decisions and invest with confidence,” said the company.

Woodside added that its submission had put forward “practical and constructive” short-term and medium-term recommendations that address issues impacting the gas industry.

“These include improving the regulatory framework to ensure approvals are provided in a timely manner and with certainty. In this respect, it is encouraging that the Commonwealth and the Western Australian State governments are working to ensure there is clarity for all parties around the consultation requirements for offshore developments,” Woodside said.