Woodside revises Scarborough project cost estimate

Woodside Petroleum has increased its cost estimate for the proposed Scarborough gas development offshore Western Australia by 5%.

The updated estimate is US$12 billion ($5.7 billion offshore and $6.3 billion onshore), and follows finalization of technical work carried out to support execution readiness in the lead-up to a final investment decision expected this year.

There is a 3% cost increase in the onshore component, including modifications to Pluto Train 1 on the Burrup Peninsula, while there is an 8% increase in the offshore estimate, including an increase in offshore production capacity from 6.5 million tonnes/year (tpy) to 8 million tpy of LNG plus an additional well.

“The cost up-date includes value accretive scope changes to deliver around 20% increase in offshore processing capacity and to modify Pluto Train 1 to enable increased Scarborough gas processing,” said Meg O’Neill, acting chief executive officer.  “It also reflects the work undertaken with our contractors to optimize the execution schedule and manage costs in preparation for FID.”

Woodside has also begun the formal process of selling down its interest in Pluto Train 2 and Scarborough.