Page 11 - AsianOil Week 14 2022

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Gas from Barossa
would be sent to
Darwin LNG for
liquefaction.

Korea Eximbank rethinks funding for

Santos-led Barossa gas project

INVESTMENT THE Export-Import Bank of Korea said last provide $313mn – including $107mn for project
week that it would put on hold its previous deci- financing and $106mn in the form of an overseas
sion to provide funding to the Santos-led Baros- business finance guarantee – for the project.
sa-Caldita gas project, in which South Korea’s SK Korea Trade Insurance has already approved
E&S is a partner. Questions have arisen about the its financial support, even though the partners
environmental impact the project might actually have yet to complete the project’s final business
have, with critics arguing that it will release sig- plan. In March, Santos
nificant amounts of carbon dioxide (CO2). Korea Eximbank officials stated that a deci-
In March, Santos announced a major carbon sion on financial support would be taken after announced a
capture and storage (CCS) project that would a comprehensive study on carbon emissions
be aligned with gas production at Barossa. Ear- reduction efforts by the project partners had major carbon
lier this year, Santos said it had booked carbon been completed and reviewed.
storage in depleted gas reservoirs in the Cooper Australian aboriginal tribes have taken legal capture and
Basin in South Australia. In mid-March, SK E&S, steps in South Korea to halt funding for the pro- storage (CCS)
part of the SK Group, said it would repurpose the ject, which involves construction of a pipeline
Bayu-Undan gas field, south of East Timor, into from the Barossa-Caldita gas fields to the Dar- project that
a CCS storage area once gas production finishes win LNG plant. The aboriginals argue that the
there next year. project will threaten their livelihood. would be
The Barossa shareholders include Santos with In March 2021, SK E&S announced it would
50% as operator, SK E&S with 37.5% and Japan’s invest $1.4bn in the development of the northern aligned with gas
JERA with 12.5%. Darwin LNG partners include Australia gas fields with the intention of produc- production at
Santos with 43.4% as operator, SK E&S with 25%, ing 1.3mn tonnes of LNG for 20 years beginning
Inpex with 11.4%, Eni with 11%, JERA with 6.5% in 2025. The plan is key to SK Group’s plan to Barossa.
and Tokyo Gas with 3.1%. produce blue hydrogen, which is manufactured
According to South Korean media, Korea by using natural gas in the process.
Eximbank on March 31 during a Credit Review SK E&S’s development plan calls for
Committee meeting announced that it would investing $672mn in its Australian subsidi-
withhold its funding approval for the time being. ary and raising the remaining capital through
The bank had been due to proceed with a plan to project financing.™

Week 14 08•April•2022 www. NEWSBASE .com P11