Woodside speeds up Scarborough development

Australian LNG player Woodside is looking to up the pace on the development of the Scarborough gas field off the country’s northwestern coast. 

In March, the company completed the acquisition of ExxonMobil’s interest in the Scarborough gas field assuming operatorship of the joint venture with a 75 percent interest and has since picked up the pace on the project development.

Speaking at the investor briefing, Woodside’s managing director and CEO Peter Coleman said the company targets the upstream portion of the project to be ready for startup by 2023 with the downstream portion to be ready for start-up a year later.

Initially, the company intends to use its interconnector from Pluto across the North West Shelf to create an early revenue flow.

He noted that the design of the second liquefaction train at the Pluto LNG facility, that will liquefy the Scarborough gas, has been increased closer to 5 million tons per year.

Coleman added that Woodside has initiated contractor negotiations for the front-end engineering design (FEED) work and in order to save time the company went to its preferred contractors in search of offers. The contractor will be chosen through a competitive bidding process conducted between two or three contractors.

“Market conditions are also supporting our strategy, LNG demand growth has been higher than most forecasters expected, development costs are at a low point in the cycle, and there has been a lack of investment in new production,” the company’s statement reads, with Coleman adding that these market conditions enable the company to choose the best contractors.

Faster Train 2 development at the Pluto LNG facility is supported by the work already done previously at the site that has been pre-prepared and the company will use the additional existing supporting infrastructure to shorten the process. The project already has environmental approvals in place for up to 12 mtpa.

Coleman noted the Scarborough development would cost about $11 billion, depending on the final development concept.

In conclusion, he said that the project infrastructure’s proximity to other resources discovered by the likes of Chevron, Shell and Western Gas, provides an opportunity for future expansion.

“I am open for conversation with these other gas owners if they wish to participate in the base development, but they are going to have to be really quick,” he said.

“They need to stop messing around and they need to give me a proper offer,” Coleman said, stressing he is not willing to listen to offers to talk as the project is already focused on execution.