MELBOURNE (Reuters) - Privately owned Western Gas said it has appointed Goldman Sachs to advise on finding a partner for its Equus gas project off Western Australia, as it aims to start producing from the $3.5 billion project in 2024.
Western Gas wants to develop the field using a 2 million tonnes a year (mtpa) floating liquefied natural gas (LNG) facility, rather than feeding into larger existing facilities as contemplated by the field’s previous owner, Hess Corp.
“Equus is at the right stage of development where the introduction of an experienced and financially capable partner can help progress the project to first gas and realize the value of the greater Equus area,” Western Gas Executive Director Andrew Leibovitch said in a statement on Tuesday.
Western Gas declined to comment on the economics of the project, but said engineering firms McDermott International and Baker Hughes had designed a “globally competitive, mid-scale LNG development plan” for Equus, involving a floating production storage and offtake (FPSO) facility, with a 160 km (100 mile) pipeline hooked up to a 2 mtpa floating LNG facility.
The project will be competing against large new developments led by Woodside Petroleum, also off Western Australia, designed to feed the North West Shelf LNG plant and an expansion of Woodside’s Pluto LNG plant.
To achieve its target of first production from Equus in 2024, Western Gas will need to make a final investment decision on the project in 2020.
Western Gas spokesman Tony Johnson said the company had spoken to parties about potentially taking a stake in the Equus project but declined to name them.
One possible partner could be a consortium led by privately owned Transborders Energy, which has said it is looking to develop small-scale floating LNG projects with gas reserves of up to 2 trillion cubic feet, about the size of Equus.
Transborders Managing Director Daein Cha said Equus would be a good fit for its floating LNG technology, but given Western Gas already has a development concept and has lined up contractors, it would just watch the project with interest.
“If they are in need of an alternative solution to further create value, we’re quite open to have that discussion,” he told Reuters, adding that Transborders does not plan to take equity stakes in gas fields where it hopes to use its technology.
Reporting by Sonali Paul; Editing by Himani Sarkar