Santos unveils $250mn drilling plan at GLNG field
Santos is putting up a further A$360mn ($250mn) for a drilling programme to support its GLNG liquefaction plant, with the capital going towards 130 new production wells at its Fairview gas field offshore Queensland, the company said June 7.
First gas is expected in October, with development due to begin later this month. Santos estimates the new wells will meet around 25% of Queensland's gas demand, equating to 78 Tj of gas/day.
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The 7.8mn metric tons/yr GLNG export plant is located in Curtis Island, Queensland. At present, it mainly extracts coal bed methane (CBM) and converts it into exportable LNG. Raw gas shortages were an issue before GLNG launched in 2015, apparently because developing the feeder CBM gas fields induced significant costs. Santos owns a 30% shareholding in GLNG, while Petronas, French Total and Kogas own 27.5%, 27.5% and 15% respectively.
Australia has seen a boom in LNG exports over the past decade, and the country is now a leading global LNG exporter. However while its export terminals are all located in the north of the country, the most inhabited areas of the southeast lack gas reserves, with a deficit expected to appear as early as 2024.
Kevin Gallagher, managing director and CEO of Santos, said: "While the gas will feed the GLNG plant in Gladstone and bring in export revenue for the nation, investments like this free up other supply sources for the domestic gas market, which is desperately needed.
"Queensland’s coal seam gas would never have been developed without access to huge international markets and the massive capital investment of our joint venture partners and customers in Asia. Without that investment, there would be less gas supply in the domestic market today.
"Since the GLNG project was sanctioned a little over a decade ago, Santos and its GLNG partners have contributed nearly A$300 million in royalties to state revenues."