Central Australia flood recovery underway, planned Darwin LNG shutdown completed
- Major wet weather and flood events continued to significantly impact Cooper Basin activities in the June quarter, however recovery is well underway and all drilling rigs are now back in operation.
- Quarterly natural gas, ethane and LNG production of 54 PJ was 9% lower than the corresponding period primarily due to lower Cooper Basin production and a planned shutdown at Darwin LNG, partially offset by stronger production from John Brookes and Indonesia.
- Crude oil production was 6% higher than the March 2010 quarter as Cooper Basin production continued to recover from the flood events.
- The Bayu-Undan/Darwin LNG facilities successfully completed a planned 35-day full field shutdown during the June quarter.
- 2010 production guidance of 49 to 52 mmboe is maintained.
- 2010 Cooper Basin gas sales revenue is not expected to be materially impacted by the flooding as customer deliveries are being met from a combination of current production and gas from storage.
Key activities during the period
- GLNG became Australia’s first major coal seam gas to LNG project to receive its environmental approval from the Queensland government.
- Fluor appointed as preferred contractor to carry out Engineering, Procurement and Construction (EPC) of the upstream facilities component of the GLNG project.
- New gas sales agreement with Wesfarmers for the supply of 60 PJ of John Brookes gas over five years commencing in the second half of 2010.
- Santos executed a A$2 billion bilateral bank loan facility. The new facility will be used to refinance Santos’ existing A$700 million in undrawn bilateral bank facilities that mature between 2011 and 2013.
Santos Chief Executive Officer David Knox said that whilst recovery from the flooding in Central Australia was well underway and all drilling rigs were back in full operation, the company’s operations in the Cooper Basin would continue to be impacted for several months.
“Gas and liquids production from the Cooper Basin improved in the June quarter and will continue to increase in the coming months as recovery from the flood events continues.”
“The GLNG project continues to make significant progress towards a final investment decision later in 2010. Engineering design works are nearing completion and environmental approval has been received from the Queensland government.”
“GLNG remains in detailed discussions with a number of parties in relation to potential LNG sales, equity in the project and collaboration between projects,” Mr Knox said.