The Dorado discovery appears to be on track again, with Carnarvon Energy (ASX: CVN) announcing the JV is completing a revision of the project’s design to optimise capital costs and accelerate the journey to FID by the end of 2024.
In an announcement to the market Carnarvon Energy, which holds a 10 per cent share in the project along with Santos (80% and operator) and CPC (10%), said the project revision aimed to improve economics through “optimised utilisation “of proposed production facilities.
Dorado, located in the prolific hydrocarbon producing postal code of the Bedout Basin offshore north western Australia, was a headline discovery six years ago when it was celebrated as the biggest oil find in Australia in 30 years and one of the biggest globally for 2018.
Since then, however, the fizz has gone somewhat flat.
Carnarvon Energy was able to woo Santos onboard as operator, but the project has stumbled over the past six years swimming upstream against fossil-fuel financing hurdles and Santos’ becoming preoccupied in costly legal battles over development of their Barossa project in the Timor Sea, a mooted merger with Woodside and other projects.
This culminated in Carnarvon chairman Bill Foster publicly criticising Santos over the protracted, on-off saga of Dorado prior to the removal of Carnarvon managing director Adrian Cook, Foster and the board. Philip Huizenga has been appointed the new chief executive.
Carnarvon management was quick out of the blocks this week and said that the optimised production capacity is expected to result in a reduction in initial capital outlay that would decrease guidance of $2 billion for Dorado.
“As part of the optimisation study, the Joint Venture has identified several idle FPSOs that could be re-purposed for the project which would further reduce the overall cost of the project and time to first oil. Any design changes would be within the scope of the approved Offshore Project Proposal.
“This allows the Operator to update the previously completed FEED work with confidence to maintain the existing FID-ready target of end-2024,” Carnarvon said.
Carnarvon was up 5% in mid-morning trade at 19.5 cents.