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ConocoPhillips to sell Australia-West interests to Santos

Published by , Editorial Assistant
Hydrocarbon Engineering,

ConocoPhillips has announced that it has entered into an agreement to sell the subsidiaries that hold its Australia-West assets and operations to Santos for US$1.39 billion, plus customary closing adjustments. In addition, the company will also receive a payment of US$75 million upon final investment decision of the Barossa development project.

The subsidiaries hold the company’s 37.5% interest in the Barossa project and Caldita Field, its 56.9% interest in the Darwin LNG facility and Bayu-Undan Field, its 40% interest in the Poseidon Field, and its 50% interest in the Athena Field. ConocoPhillips will retain its 37.5% interest in the Australia Pacific LNG project and operatorship of that project’s LNG facility. Proceeds from this transaction will be used for general corporate purposes.

“We are extremely proud of our work in Australia-West over the last 20 years. We are pleased that Santos recognises the value of the existing business as well as the opportunity to develop Barossa and thereby continue Darwin LNG’s operations for another 20-plus years,” said Matt Fox, Executive Vice President and Chief Operating Officer. “While we believe the Darwin LNG backfill project remains among the lower cost of supply options for new global LNG supply, this transaction allows us to allocate capital to other projects that we believe will generate the highest long-term value to ConocoPhillips.”

Production associated with the assets being sold was approximately 50 000 boe/d for the first half of 2019 and proved reserves were approximately 39 million boe at year-end 2018.

The effective date for the transaction will be 1 January 2019. The transaction is subject to regulatory approval and other specific conditions precedent. The sale is expected to be completed in the 1Q20.

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