SK,one of South Korea’s largest family-run conglomerates or chaebols,together with Japanese power generator JERA and Santos,committed to build Barossa in March 2021 for $US3.6 billion.
SK oil and gas subsidiary SK E&S also received a $US330 million loan from the Korea Trade Insurance Corporation.
The go-ahead for Barossa was decried by climate activists as the offshore field 265 kilometres from Darwin contains up to 20 per cent carbon dioxide that would be released into the atmosphere making Barossa liquified natural gas the most polluting per tonne produced in Australia.
Gas from Barossa will flow to the Darwin LNG plant that will be shut down later this year when supply from the Bayu Undan field in Timor-Leste waters runs out.
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Santos had planned to use the empty Bayu Undan pipeline to transport Barossa gas the last about 100 kilometres to Darwin. However,in August it decided to run the Barossa pipeline all the way to shore at an additional cost of $US622 million.
The added cost preserves the Buyu Undan pipeline for the possible transport of carbon dioxide from Darwin to the Bayu Undan field for storage. If carbon storage at Bayu Undan is viable,it will solve SK’s emission problem with its financier. But if the CCS project does not proceed,the Barossa partners would have wasted the additional spend on the pipeline.