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NT government to support feasibility study for ConocoPhillips's Darwin LNG expansion

EBR Staff Writer Published 19 April 2017

The Northern Territory (NT) government in Australia will support a study that will assess the feasibility of the potential expansion of the Darwin Liquified Natural Gas (DLNG) project of ConocoPhillips.

In this regard, the government will be funding AUD250,000 ($187,900) for the study to back the project which has a potential of creating thousands of jobs in the region.

Its contribution amounts to 40% of the study costs, with the remainder sponsored by ConocoPhillips and upstream resource owners in Evans Shoal, Poseidon, Caldita-Barossa, Bonaparte LNG (Petrel Tern) and Cash Maple fields.

The viability of developing a second LNG train at the Darwin LNG facility at Wickham Point will be examined by the feasibility study which is slated to completed by the year end.

According to NT Chief Minister Michael Gunner, a second train for the LNG facility would require a multi-billion dollar investment while marking a new development in the country’s off-shore gas industry.

Gunner said: “The Territory Labor Government is focused on restoring trust by creating jobs – especially in the private sector - and we believe funding this feasibility study is a good investment.

“The first train at Darwin LNG created around 2,500 jobs during construction and over 8500 sub-contracts and purchase orders.

“In operation it directly supports over 250 local jobs and on average around A$100m ($75.1m) per year in supply and service opportunities.”

Gunner concluded that the government was backing the feasibility study as it is a considerable investment for possible expansion at Darwin LNG while giving scope to thousands of jobs related to construction and operation of the facility.

ConocoPhillips Australia West external affairs vice president Kayleen Ewin called the feasibility study to be the first step in exploring new methods to commercialise the considerable amount of offshore resources available in Northern Australia.

DLNG, which was commissioned in 2006, converts the gas sourced from a 502km pipeline from the Bayu-Undan field into LNG which is subsequently sold to Tokyo Electric and Tokyo Gas in Japan.