Gladstone LNG group gets FID for Arcadia gas project

May 31, 2018
The Santos Ltd.-led Gladstone LNG (GLNG) partners have announced a final investment decision for the $400-million (Aus.), 137-well Arcadia coal seam gas (CSG) project in the Bowen basin of southeast Queensland.

The Santos Ltd.-led Gladstone LNG (GLNG) partners have announced a final investment decision for the $400-million (Aus.), 137-well Arcadia coal seam gas (CSG) project in the Bowen basin of southeast Queensland.

The initial phase of the Arcadia development will deliver a peak of 75 terajoules/day of gas to supply the GLNG plant on Curtis Island as well as the domestic gas market in eastern Australia.

It is expected to be brought on stream late in 2019 and produce a total of 27 petajoules of CSG by 2022.

Arcadia is near the Queensland inland town of Injune about 680 km northwest of Brisbane.

The project involves the drilling of 137 new CSG wells and the construction of a 140-km gas and water gathering network, along with two 4G communication towers, a new compression station, a 4 megaliter/day water treatment plant, a 5-Mw gas-fired power station, and associated roads and other systems.

The project will create as many as 300 construction jobs and local business opportunities in the region.

Kevin Gallagher, Santos managing director and chief executive officer, said the decision to give the green light for Arcadia follows a successful 13-well pilot program that tested changes to the planned well design and operating philosophy.

The $400-million finance commitment is in addition to the $900 million the group is investing to develop new Surat and Bowen basin gas fields in the Maranoa, Western Downs, Central Highlands, and Banana regions of Queensland in 2018 to provide additional gas for GLNG.

Santos has 30% interest in GLNG with Petronas with 27.5%, Total SA with 27.5%, and Kogas with 15%.

The Arcadia investment package announcement comes only a week after Santos rejected a $14.5-billion (Aus.) takeover proposal from US private equity firm Harbour Energy (OGJ Online, May 23, 2018).