Australia: Darwin LNG Maintenance Scheduled for April 2012

Australia’s Darwin LNG will undergo a scheduled maintenance at its 3.6 million mt/year complex, which is expected to begin in the last week of April 2012, Paul Dubuisson, vice president of operations drilling and supply chain at ConocoPhillips, said on the sidelines of the 2011 South East Asia Australia Offshore Conference Thursday. There will be a “dual-shutdown” at both the offshore facility at the Bayu-Undan gas field in the Timor Sea and the onshore Darwin plant located at Point Wickham.

The onshore plant will be shut for 30-35 days, while the offshore plant will be shut for a slightly shorter period, Dubuisson said adding that the company is still finalizing the maintenance timing. The plants are typically shut every two to three years for regulatory and inspection checks, and to conduct maintenance work such that operation efficiency can be improved, according to Dubuisson. ConocoPhillips operates and holds 57.2% of the Darwin LNG project, which started up in 2006, processing gas from the Bayu-Undan offshore field. Santos holds 11.4% of the plant, alongside Japan’s Inpex (11.3%), Italian major Eni (11%), and Japanese term LNG customers Tokyo Electric Power Company​ and Tokyo Gas​ (9.2%). Dubuisson also said ConocoPhillips remains open to an expansion at the Darwin LNG plant, which could see capacity reach 10 million mt/year. However, he added that no concrete time frame is in plan yet. Platts reported in April that Australian upstream company Santos was unable to convince ConocoPhillips of the merits of expanding their 3.6 million mt/year Darwin LNG plant, despite holding nearby gas reserves, according to Santos CEO David Knox.

Meanwhile, Dubuisson said Australia could become the world’s second-largest LNG supplier by 2020, after Qatar, rising from the sixth position achieved in 2009, if all the current planned LNG projects go through, which could see Australia’s LNG export capacity quadruple.

LNG projects in Australia have an advantage over those in Middle East as the shipping distance to traditional buyers like Japan, South Korea and Taiwan and new entrants such as coastal China and Singapore, is significantly shorter. “With new markets emerging west of the Malacca Strait, such as coastal India and Thailand, Australia is uniquely positioned to compete,” Dubuisson said. “Natural gas is definitely an integral part of the global energy equation,” he said, adding that “gas is going to remain the world’s leading baseload power generation fuel” due to the abundant reserves and low greenhouse gas emissions. The two-day conference in Darwin, Australia, started October 6 and ends Friday.

By Chloe Hang (Platts)

Source: Platts, October 6, 2011; Image: ConocoPhillips