Australian energy player Santos has marketed, sold and loaded the first condensate cargo from the Barossa gas project for delivery to SK Innovation E&S in South Korea.
Approximately 300,000 barrels of condensate were loaded from the BW Opal floating production, storage and offloading (FPSO) vessel at Barossa on July 24 aboard the Aframax tanker Boccadesse for delivery to South Korea, where it will feed SK Incheon Petrochem’s refinery in Incheon, producing predominantly naphtha and jet fuel. The cargo is expected to arrive at Incheon Port in early August.
Of the 3 million barrels produced annually at Barossa, SK Innovation E&S is entitled to 1.1 million barrels based on its equity share. According to the South Korean firm, this marks the first time a Korean private company has brought home condensate secured through its own overseas resource development.
Beyond condensate, SK Innovation E&S has been importing 1.3 million tons of LNG per year from Barossa since this year, equivalent to roughly 3% of Korea’s total annual LNG imports. Over the project’s 20-year contract term, this equates to a total entitlement of 22 million barrels of condensate and 26 million tons of LNG.
“The Barossa project is a case where a private company took a long-term view on overseas resource development, ultimately connecting commercial production to actual imports into Korea. Bringing home LNG and condensate from the Barossa gas project is significant in that it reduces our reliance on external resources and strengthens the stability of Korea’s industrial supply chain,” a spokesperson for SK Innovation E&S said.
Barossa is located approximately 285 kilometers north of Darwin, in northwestern Australia. SK Innovation E&S has participated in the project since 2012, covering the full development cycle from reserves assessment to permitting and facility construction.
Santos operates the project and holds a 50% interest, alongside joint venture partners SK Innovation E&S’s subsidiary, PRISM Energy International Australia (37.5%), and JERA Australia (12.5%).
This first condensate export from the project follows the start of LNG production at the Darwin LNG plant, which is now producing at 97% of planned rates.
To remind, JERA in June confirmed the arrival of its first LNG cargo at the Futtsu LNG terminal in Japan from Barossa. Participating through its Australian subsidiary, JERA will offtake approximately 425,000 tons of LNG per year in line with its equity share.
“The Darwin LNG plant is now producing at 97 per cent of planned rates, with LNG cargoes loading approximately every eight days and condensate now flowing to market,” said Santos Managing Director and Chief Executive Officer Kevin Gallagher .
“Australia is a trusted supplier of energy to key partner countries, and those same partners supply Australia with the refined fuels and energy products we rely on. South Korea is Australia’s second-largest supplier of refined liquid fuels and Santos is proud to actively support the energy security relationship between our two countries, supplying South Korea with both LNG and the condensate feedstock that South Korean refineries need to produce the jet fuel and diesel that the Australian economy relies upon. This cargo is that two-way relationship in action.”