Woodside Pumps Up Cost For Scarborough Gas
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Woodside has told an investor day presentation that it has increased the cost of its Scarborough development by $US1 billion after lifting the processing capacity at its Pluto gas facility.
The company said yesterday that it now expects to spend $US11 billion ($A14.5 billion) after raising the capacity of its planned second train, or processing plant, at the Pluto liquefied natural gas facility of the northwestern WA cost.
That is a sharp rise from the February estimate of a range of $US8.5 billion and $US9.7 billion.
The news saw the shares dip 1.2% to $33.80 which was more to do with easier oil prices overnight after they hit new three and a half year highs at the start of the week.
Woodside CEO, Peter Coleman revealed the new Scarborough plan includes an upstream capacity of nine million tonnes a year, up from a previous estimate of 7 million tonnes a year
Forecast first gas has been brought forward to early 2023.
It will effectively double the minimum size of the second train to between 4.5 million tonnes and 5 million tonnes a year, from between 2 million tonnes and 3.3 million tonnes a year.
Woodside bolstered its stake in the project to 75% in March and became operator by acquiring ExxonMobil’s stake through a $US744 million deal. BHP has the other 25%.
Woodside has set a 2020 final investment decision on developing Scarborough to pipe 6 million tonnes a year of gas to the Pluto LNG onshore plant it operates in the Pilbara.
The company maintained a forecast from February that its annual production will reach about 100 million barrels of oil equivalent in 2020. This year’s forecast is for around 84 million barrels.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.