French energy giant Total has definitively ruled out any reversal of the decision to process gas from the $20 billion Ichthys gas project in Darwin.
French energy giant Total has definitively ruled out any reversal of the decision to process gas from the $20 billion Ichthys gas project in Darwin.
The head of the company's Asia-Pacific division, Jean-Marie Guillermou, also said it was unlikely Total would ever use a proposed gas hub at James Price Point for any other gas it might discover off the Kimberley coast.
Total, the world's fourth largest oil and gas company, is a 24 per cent shareholder in the Ichthys project being developed by Japan's Inpex Petroleum and also holds interests in 10 other major exploration permits in WA's offshore Browse and Bonaparte basins.
After initially hoping to build a gas processing facility for Ichthys in WA, ongoing uncertainty about the site of onshore processing in the Kimberley in 2007 led the the partners to opt for a 900 km subsea pipeline to Darwin's gas processing precinct at Wickam Point.
Speaking at a media briefing in Perth today, Mr Guillermou said the uncertainty surrounding alternative sites in WA had made Darwin easily the best option for the partners and there was no turning back.
"Clearly the uncertainty of this (WA) location was such that we couldn't live with it any longer, and is why finally we decided to go to Darwin," he said.
"This will cost a larger investment ... but we are now extremely happy with this industrial site in Darwin ... and for us it will create a lot of opportunity.
"Now the decision is made, there is absolutely no way we could change this decision."
With a swag of other major permits in the Browse and Bonaparte basins, in which drilling is about to begin, Total has high hopes of making additional large-scale discoveries in the region.
But Mr Guillermou said any such discoveries were likely to be developed via infrastructure established for the Ichthys project, rather than using the State Government's proposed onshore gas hub at James Price Point, 60km north of Broome.
"The fact that this pipeline will exist will change the exploration capability of this area," he said. "Once you have the LNG plant in Darwin, it means you will have room for additional trains there. So anything you can find ... there will be an option to direct it to Darwin."
Mr Guillermou said leveraging off existing infrastructure to develop any new discoveries in Total's permits was likely to be "much more efficient than if you start from scratch".
Additionally, he said Total could consider floating LNG options for other discoveries for which Darwin may not be the optimal option, and potentially even some form of asset swaps with other operators in the region.
Furthermore, he said it was possible the infrastructure being established for Ichthys could ultimately be expanded to process gas from other parties with permits in the region.
Mr Guillermou's comments underline the continuing uncertainty surrounding the WA government's proposed gas hub at James Price Point.
Already facing stiff opposition from environmentalists and tourism operators, the site has come under further pressure in recent months due to a rift in traditional owner groups which prevented a formal land use agreement for the site being signed by the government's July deadline.
The government has since hardened opposition by opting to proceed with compulsory acquisition of the site to ensure the partners in the Woodside-led Browse LNG project can meet the government-set deadline for project development approval in 2012.
