ConocoPhillips, Santos LNG Projects Will Swap Gas to Lower Costs
By James Paton
ConocoPhillips (COP) and Santos Ltd. (STO), developing separate liquefied natural gas projects in Australia at a cost of more than $40 billion, agreed to share pipelines and exchange gas to reduce costs and duplication.
The projects in Queensland state will build two pipeline connection points and sign gas-swap agreements, according to a joint statement today from Adelaide-based Santos and ConocoPhillips’s partner, Sydney-based Origin Energy Ltd. (ORG)
ConocoPhillips and Origin are building a A$24.7 billion ($24 billion) project to liquefy natural gas for shipment to Asia, while Santos is developing an $18.5 billion development. Australia, forecast to become the world’s largest supplier of LNG with seven projects under construction, is facing rising costs that threaten expansions.
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