Australia’s Santos said Thursday it had signed a letter of intent to sell a 12.5 per cent stake in the Barossa project to Japan’s LNG trading giant JERA.
The Barossa gas field in northern Australia is being developed to secure feed gas for the Darwin LNG plant in which JERA already has a 6.1 per cent interest.
Santos said that signing of the deal with JERA advances partner alignment between the Darwin LNG and Barossa joint ventures for the development of Barossa project.
The Barossa field is located offshore about 300 kilometres north of Darwin.
Santos purchased the ConocoPhillips’ northern Australia business for about $2 billion last year, giving it control of Darwin LNG and Barossa.
“Following completion of the ConocoPhillips acquisition and the sell-downs to JERA and SK E&S, Santos will hold a 43.4 per cent interest in Darwin LNG and a 50 per cent interest in Barossa”, said Santos CEO Kevin Gallagher .
He added that Santos continues talks with other parties for the sale of further equity in the Barossa project, in line with the company’s previously stated target ownership level of around 40 percent.
Santos is also in talks with buyers for Barossa volumes.
Santos announced in March it would postpone a final investment decision on Barossa due to the coronavirus outbreak and the drop in oil prices.
“Barossa remains an important project for Santos due to its brownfield nature and low cost of supply, and we will continue to use this time to achieve alignment and seek to further strengthen the economics of the project”, said Gallagher.