A new train is in the pipeline for an LNG project off the northwest coast of Western Australia (WA), following the recent strategic partnership between Japan’s Inpex and Texas-based Formentera to accelerate project development by leveraging US shale technology and expertise to unlock what is considered one of the world’s most promising new shale gas resources.
The duo has entered into a strategic joint venture partnership that will accelerate the development of vast onshore natural gas resources Beetle basin in Australia’s Northern Territory by creating a new domestic source of natural gas for the country and supporting future LNG exports to premium markets in Asia and around the world.
With this partnership, Inpex will acquire approximately 68,000 net acres across a core area of approximately 355,000 gross acres within the 1.9 million net acre Formentera site in the basin through a step-earning of up to $208 million, which is subject to off-slope regulated provisions.
The Japanese company has the option to acquire approximately 75,000 additional net acres within the core block for $266-$411 million, depending on the timing of implementation. The transaction consideration will be delivered primarily as development capital by defraying the costs of the drilling programme.
Formentera’s wholly-owned subsidiary, Daly Waters Energy (DWE), will operate the joint venture. Daly Waters and Inpex, together with the other joint venture partner, Tamboran Resources, will boost local production, based on a 40 million cubic feet per day (mcf/d) supply agreement with the Northern Territory.
The partnership also plans to backfill and expand LNG export capacity in the region, with the Japanese player planning to add a third LNG train in Ichthys LNG A project in Darwin, Australia, anchors Beetaloo’s growing production.
Tetsu MurayamaInpex Managing Director, Country Head in Australia, stressed: “We are pleased to be involved in this exciting opportunity with Daly Waters to demonstrate the potential for natural gas development from the Northern Territory’s Beetaloo Sub-Basin in the near term. By developing low-carbon natural gas with Dubai Energy Corporation, Inpex will also continue to supply LNG to key trading partners such as Japan and Taiwan, and we are proud to play our part.”
With the assessment work largely completed, the next phase will focus on building infrastructure, including takeaway and processing capacity to support domestic supply and future LNG exports. As this infrastructure develops, Petallo’s size and location are viewed as a potential and reliable long-term source of supply to the high-demand populations and industrial centers along the east coast of Australia.
Brian SheffieldManaging Partner of Formentera, commented: “I am extremely proud of the joint venture team and its work to demonstrate Beetaloo’s ability to support real, scalable natural gas development for domestic use and future export. This is a turning point for the basin, for Australia, and for the future of shale development internationally.”
The Ichthys LNG joint venture consists of Inpex (operator with 67.82% interest), TotalEnergies (26%), and the Australian subsidiaries of CPC Corporation Taiwan (2.625%), Osaka Gas (1.2%), Kansai Electric Power (1.2%), JERA (0.735%), and Toho Gas (0.42%).
Leah Finocchiaro The MLA, Chief Minister of the Northern Territory, confirmed: “We welcome this announcement, which supports continued economic growth in the Territory’s energy sector. The Northern Territory is uniquely placed to support Australia’s future.
“Releasing natural gas from Beetaloo and delivering it to domestic and international markets is not just an opportunity, it is a national imperative. In our year of growth, certainty and security, we will continue to support reliable and affordable energy for the people of the Territory, and enhance energy security for the nation, allies and the region.”
Located about 220 kilometers off the coast of Western Australia and 820 kilometers southwest of Darwin, the Ichthys field covers an area of about 800 square kilometers in water with average depths of about 250 metres, while an 890-kilometre pipeline exports gas and condensate from the field to onshore facilities for processing near Darwin.
The Ichthys project produces up to 9.3 million tons of LNG and 1.65 million tons of LPG per year, along with more than 100,000 barrels of condensate per day at peak production. After pretreatment offshore to remove water and extract condensate, gas from the field in the demonstration basin is routed to the main line in the Asia-Pacific region.
Herimas slippery The ship lifted and installed the 4,800-ton load Ichthys LNG billion cubic metres on Ichthys Explorer Central Processing Facility (CPF), as part of Ichthys LNG Stage 2 Development off the northwest coast of Western Australia, after Unity Leave PTMI manufacturing yard in Batam, Indonesia.
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