Rick Wilkinson
OGJ Correspondent
MELBOURNE, May 11 -- Santos Ltd., Adelaide, may defer for 6 months its decision on whether to go ahead with its Gladstone, Queensland, coal seam gas-LNG project after the Australian government announced a resource “super tax” on the mining industry.
Speaking after Santos’ annual meeting, Chief Executive David Knox said the final investment decision on the project would be pushed back. He said the new tax is an additional risk that needs to be evaluated prior to a decision.
Knox was referring to the government’s plan to hit resources profits with a 40% tax, which sent shock waves through the CSG industry. Shares in CSG companies fell sharply last week following the government announcement.
Despite delaying the go-ahead decision, Knox said there has been no revision of the anticipated 2014 start-up date for the project to pipe CSG from the Surat-Bowen basin to a proposed LNG plant at Gladstone.
The Santos-Petronas joint venture plans a 1-train, 3.6 million tonne/year plant.
Santos has a 60% interest and Petronas has 40%. There is also a binding agreement with Petronas to purchase 2 million tpy of LNG from the project.