Conoco targets Darwin LNG backfill

US operator ConocoPhillips has set targets of mid-2018 for a potential $15-billion natural gas project off northern Australia.

The development will offer feedstock for its Darwin LNG project once existing supplies have depleted. However, the company says that expanding the project is not viable without a steep drop in operating costs.

ConocoPhillips’ Australia vice-president for exploration and development Frank Krieger has said that either the Poseidon fields in the Browse Basin or the Caldita-Barossa gasfields in the Timor Sea could be developed and used as “backfill” for the Darwin LNG project, as supposed to an expansion.

Output would be used to maintain operations at the 3.7-million-tonne-per-year LNG project after reserves at the Bayu-Undan field in the Timor Sea run out in 2022 or 2023.

Darwin LNG has already obtained development approval to expand site capacity to 10 million tonnes. However, this is unlikely given a considerable increase in operating costs, augmented in recent months by depressed oil prices.

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