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AsianOil EAST ASIA AsianOil
Japan pledges $10bn for global LNG projects
POLICY
THE Japanese government has pledged $10bn of both public and private funding for liquefied natural gas (LNG) projects around the world.
Japanese Minister of Economy, Trade and Industry (METI) Isshu Sugawara said on Sep- tember 26 that the investments would mainly be earmarked for upstream, midstream and down- stream LNG projects in Asia.
“On top of Japan’s commitment two years ago of investing or financing more than $10bn in energy supply chains, we are making a fresh commitment of additional and collective $10bn funding from both public and private sectors,” Sugawara said during a keynote speech at the annual LNG Producer-Consumer Conference in Tokyo.
Former trade minister Hiroshige Seko made the original commitment at the same conference in 2017, though the funds were mainly allocated to upstream projects such as LNG Canada and Mozambique LNG, in which Mitsubishi and Mitsui & Co. hold stakes respectively.
Sugawara added that the government would train 500 experts in the LNG technology to add the nearly 500 that Japan has already trained in recent years.
“By making these commitments to help develop the global LNG market, Japan will work hard to reinforce global energy security,” he said. His comments come in the wake of recent attacks on key Saudi Arabia oil production facil- ities, which has led to an escalation of tensions in the volatile region.
While it might seem counterproductive for Japan, the world’s largest importer of LNG, to support infrastructure projects in other coun- tries, this strategy is a response to a specific set of circumstances.
Spot LNG prices may have fallen this year, but most pricing in Asia remains driven by the oil link, making the feedstock fairly expensive. As Japan turns its nuclear power plants (NPPs) back on – in a move backed by political will and judicial rulings – LNG faces competition.
Given this pressure, it is sensible for Jap- anese companies to bolster alternative desti- nations for contracted supplies. This is given added weight when considering that energy trader JERA revealed in mid-September that it had successfully asked some of its long-term suppliers to drop destination clauses from existing contracts.
OCEANIA
Santos, BP win permit offshore WA
PROJECTS & COMPANIES
SANTOS and BP have been awarded a new per- mit offshore Western Australia that the Australian independent described as being “on-trend with the Dorado discovery” in the adjacent permit.
Santos said on September 27 that it would operate WA-541-P, which covers 6,964 square km of the Northern Carnarvon Basin, with a 50% stake. BP owns the remaining interest. The permit lies to the west of the recent Dorado, Roc and Phoenix South hydrocarbon discoveries in the Bedout Sub-basin.
Santos said the permit’s southern section was directly adjacent to the proven Dorado play, which is interpreted to extend into the new block.
Santos managing director and CEO Kevin Gallagher said “Santos is pleased to have been awarded this acreage on-trend with the Dorado discovery, a now proven world-class, liquids-rich petroleum system with high-quality reservoirs.”
The Dorado play is located in WA-437-P, which Santos also operates in an 80:20 joint venture with Carnarvon Petroleum. Santos announced in July that the Dorado-2 appraisal well had confirmed
a major oil and gas resource in the permit. The well was drilled down-dip around 2 km from the Dorado-1 discovery, which was made in July 2018. Gallagher said at the time that second discov- ery was larger than anticipated and significantly de-risked future development.
In other news, the developer announced on September 26 that ConocoPhillips had awarded an engineering, procurement, construction and installation (EOCI) contract for a 260-km gas export pipeline at the Barossa project to Allseas Group. Santos owns 25% of the Barossa project, while ConocoPhillips and SK E&S both hold 37.5% interests.
The pipeline will tie the Barossa gas field, which lies 300 km north of Darwin, into the existing Bayu Undan-Darwin Pipeline. Santos owns an 11.5% stake in Darwin LNG.
Santos said the pipeline award was “another big step” towards a final investment decision on the Barossa project in early 2020. The project area encompasses petroleum permit NT/RL5 located offshore the Northern Territory.
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w w w . N E W S B A S E . c o m Week 39 02•October•2019
