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According to a statement by Santos, the contract is for up to 0.5 million tonnes of LNG per annum over a period of 3 years plus one quarter.
Santos will deliver the LNG supplies to Glencore Singapore.
The contract will start in the fourth quarter of 2025 with LNG being supplied from Santos’ global portfolio of LNG assets on a delivered ex-ship basis.
Santos managing director and CEO Kevin Gallagher said the contract with Glencore is an extension of their existing “strong” business relationship and a “great opportunity” for both Santos and Glencore to leverage their expertise in Asian LNG markets.
“This oil-indexed contract along with the recently executed long-term LNG sales and purchase agreement with Hokkaido Gas in Japan demonstrates Santos’ strong LNG portfolio position and customer relationships in the region,” he said.
He said there continues to be “extremely strong” demand in Asia for high heating value LNG from projects such as Barossa and PNG LNG.
“Santos is committed to supporting the energy security of our valued customers across Asia,” Gallagher added.
Barossa
Santos recently said the Barossa gas project, which will supply feed gas to the Santos-operated Darwin LNG plant, is almost 80 percent complete and remains on target for first production in the third quarter of 2025.
Back in 2021, Santos took a final investment decision for its $3.6 billion Barossa project.
Natural gas will be extracted from the Barossa field, located in Commonwealth waters about 285 kilometers offshore north-north west from Darwin, and transported via a pipeline to the existing Darwin LNG facility.
In November last year, the last LNG cargo produced from the Bayu-Undan gas field has sailed from the Santos-operated Darwin LNG plant in Australia’s Northern Territory.
The final LNG shipment from Bayu-Undan left the 3.7 mtpa Darwin LNG plant at Wickham Point on November 11.
The Darwin LNG plant launched operations in 2006 and the facility is now being readied for the next 20 years, in preparation for the start of Barossa gas production in 2025.
To prepare for Barossa gas, Santos is working on the Darwin LNG life extension project.
PNG LNG, GLNG
Santos operates the 7.8 mtpa Gladstone LNG export plant on Curtis Island near Gladstone.
The facility shipped 22 LNG cargoes during the second quarter, the same as in the second quarter last year and five less compared to the prior quarter.
GLNG produced 1.33 million tonnes of LNG during the quarter, up from 1.26 million tonnes in the same quarter last year and down from 1.64 million tonnes in the prior quarter.
During the second quarter, the ExxonMobil-operated PNG LNG project in Papua New Guinea shipped 27 cargoes of LNG, the same number of LNG cargoes as in the same quater last year and in the previous quarter.
Santos currently has a 42.5 percent stake in the LNG export plant in Caution Bay following the Oil Search merger, and it earlier this year agreed to amend the terms of sale of its 2.6 percent stake in the LNG project to Papua New Guinea’s national oil and gas company Kumul Petroleum.
ExxonMobil holds a 33.2 percent operating interest in PNG LNG which is able to produce more than 8.3 million tonnes of LNG annually, an increase of 20 percent from the original design specification of 6.9 mtpa.
France’s TotalEnergies and its partners, which include Santos, are also working on the Papua LNG export project in Papua New Guinea.
Gallagher recently said the partners plan to take a final investment decision on the Papua LNG at the end of 2025.
TotalEnergies has a 37.55 percent operating stake in the Papua LNG project, US-based ExxonMobil has 37.04 percent, Santos owns a 22.83 percent interest, and Japan’s JX Nippon holds 2.58 percent.
The project calls for the design of about 4 million tonnes per year of liquefaction capacity adjacent to the existing PNG LNG processing facilities, and located 20 kilometers northwest of Port Moresby.