The National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) accepted Woodside’s Scarborough Offshore Project Proposal after an assessment of the potential environmental impacts over the life of the project.
Woodside has said the current uncertain global investment environment means the project is being progressed on a revised schedule, but NOPSEMA’s acceptance of the proposal is a significant step forward in the development of the gas field which is estimated to hold 11.1 trillion cubic feet of dry gas.
“The proposed offshore development, referred to as ‘Scarborough’, targets the commercialisation of the Scarborough and North Scarborough gas fields, through the construction of a number of subsea, high-rate gas wells, tied back to a semi-submersible floating production unit moored in approximately 900m of water close to the Scarborough field,” NOPSEMA said.
“Although we are now facing challenging market conditions due to the impact of COVID-19 and volatile oil prices, Scarborough is a world-class resource which we plan to develop at a globally competitive cost through our proposed Burrup Hub,” Woodside CEO Peter Coleman said.
The company said the Burrup Hub, a proposed regional LNG hub on the Burrup Peninsula where Woodside have been operating for more than 30 years, “involves the proposed development of some 20 to 25 trillion cubic feet of gross dry gas resources from Scarborough, Browse, and Pluto”.
The Scarborough gas field was first drilled in 1979 by operating company Esso Exploration & Production Australia and was soon listed as a significant non-commercial gas discovery due to its locality.
“Because of the water depth, this discovery is not considered to be commercial, and the well was abandoned,” the Department of Mines and Petroleum said in its 1979 annual report. “These gas discoveries may be of interest in the longer term.”
Woodside realised this interest in developing the project, with its value including a peak construction workforce of almost 3200 jobs in 2022, capital expenditure of $15.8 billion in WA between 2019 to 2051, and boosting Australia’s Gross Domestic Product by $125 billion between 2019 to 2063, of which 98 per cent will be realised in Western Australia.
“The proposed development will support local operation and WA communities for decades, including long-term investment in education, training and jobs.
“The development will extend the life of the existing Woodside-operated facilities on the Burrup Peninsula and provide long-term cleaner reliable energy to both domestic and global markets.”
In 2018, Woodside acquired Exxon Mobil’s 50 per cent interest in the Scarborough, raising its own interest to 75 per cent.
Shortly after, BHP acquired a further 1.5 per cent interest in the project in addition to its 25 per cent, leaving Woodside with 73.5 per cent interest.
According to NOPSEMA, Woodside is targeting a start-up in 2023.
“Achieving these milestones is subject to all necessary joint venture approvals, regulatory approvals and appropriate commercial arrangements being finalised,” NOPSEMA said. “The first drilling phase is targeted in 2020 followed by the installation of the trunkline in 2022, FPU installation in 2023 and phase 2 drilling (potentially including Thebe and Jupiter) in 2025.”