Cost estimates rise for Woodside’s delayed Browse LNG project

Australia’s Woodside Energy has raised its cost estimate for its long-delayed Browse LNG project, Reuters reported on May 11.

The proposed project, which would be located about 420 km offshore Broome, Western Australia, is now projected to cost about A$48.7 bn ($35.2 bn), up considerably from its last estimate in 2019, when it was forecast to cost A$27.3 bn ($19.8 bn).

The scope of the project has evolved over the years with a carbon capture and storage (CCS) component added in 2023. The CCS project would see up to 4 mn metric tons of carbon dioxide emissions injected each year back into the Browse reservoirs, while reducing direct emissions by 47%.

The Browse gas fields off northwest Australia are the country's largest untapped gas resources. Australian energy giant Woodside would like to use the Browse fields to provide feedgas for its North West Shelf LNG plant.

In September, Canberra granted final environmental approval for the extension of the North West Shelf project after a lengthy, six-year approvals process of extensive assessment and appeals.

The extension prolonged the facility for another 40 years, allowing it to operate until 2070. The facility shipped Australia’s first LNG cargo back in 1989, with over 6,500 LNG cargoes shipped overseas since then.

However, the North West Shelf expansion’s approval is subject to strict conditions including the requirement for the facility to reduce its emissions every year and reach net zero greenhouse gas emissions by 2050, as part of Australia’s Safeguard Mechanism.

Meanwhile, the Browse project has also had its timelines pushed back by environmental approvals and talk for a processing contract, with environmental groups contesting the project over concerns that it could threaten the nearby Scott Reef.

Woodside is the operator of Browse LNG with a 31% interest. BP holds a 44% stake, PetroChina has an 11% interest, and Japan Australia, which consists of Mitsui and Mitsubishi, possesses a 14% stake.