- Oil and gas giant, Santos (STO) has agreed to sell a 25 per cent interest in Darwin LNG and Bayu-Undan to a Korean company for approximately $605 million
- The Korean company, SK E&S, already has a 37.5 per cent interest in the Barossa project to backfill Darwin LNG
- The sale is conditional on completion by Santos of the purchase of ConocoPhillips northern Australia and Timor-Leste interest
- Santo’s sale will help develop Barossa, which is a key priority for both companies
- On market close, Santos is down 7.94 per cent and is trading at $4.29 per share
Oil and gas giant, Santos (STO) has agreed to sell a 25 per cent interest in Darwin LNG and Bayu-Undan to a Korean company for US$390 million (approximately A$605 million).
The Korean company, SK E&S, already has a 37.5 per cent interest in the Barossa project to backfill Darwin LNG. Santo’s sale will help develop Barossa, which is a key priority for both companies.
This sale is conditional on completion by Santos of the purchase of ConocoPhillips northern Australia and Timor-Leste interest.
Last October, Santos announced it will acquire ConocoPhillips northern Australia interest. The net funding requirement for the purchase is expected to be around US$775-$825 million (approx. A$1.2 billion – $1.3 billion).
Santos CEO Kevin Gallagher said the agreement with SK E&S builds partner alignment and is another significant step towards bringing Barossa gas into production through the Darwin LNG facilities.
“We are delighted to have agreed terms with SK E&S to acquire interests in Darwin LNG and Bayu-Undan and look forward to continuing and building on the long-term relationship between our two companies,” he said.
“Santos continues to build alignment between the Darwin LNG and Barossa joint ventures through discussions with Darwin LNG participants and others to acquire equity in Barossa,” he added.
The company is currently in advanced discussions to sell-down equity in Barossa to target ownership of around 40 per cent to achieve increased partner alignment.
Darwin Liquefied Natural Gas (LNG) began in 2013 and was the first LNG project in the Northern Territory, second in Australia. Gas is sent in a 502km pipeline from Bayu-Undan field to Darwin LNG at Wickham point, where it is converted to LNG and shipped overseas.
Bayu-Undan is a gas-condensate field located offshore in Timor-Leste offshore waters.
On market close, Santos is down 7.94 per cent and is trading at $4.29 per share.