Carnarvon Energy Ltd (ASX:CVN) today iterated to shareholders that delivery of the Dorado Phase 1 liquids development in the Bedout sub-basin offshore Western Australia is a core focus for the company, with its primary drivers being lowest capital cost and shortest timeframe to first production.
Carnarvon continues to support Santos, the project operator, in driving the project forward in preparation for a final investment decision (FID) next year.
The key elements in reaching a FID include optimising and completing the facilities design for an integrated development of the Dorado and Pavo resources, settling project costs and finalising key construction contracts for the floating production storage and offloading (FPSO) vessel and wellhead platform.
It requires that Carnarvon secures project debt finance. Following the divestment of a portion of Carnarvon’s interests in the Bedout Sub-basin to Taiwan’s national oil and gas company, CPC Corporation, Taiwan, the company doesn’t expect anticipate the need for an equity raising to cover Carnarvon’s share of costs for the Dorado Phase 1 liquids development.
Securing environment plan (EP) approvals for the Dorado development activities will be progressed ahead of FID for Dorado.
An EP is typically addressed after FID for offshore projects, but due to recent industry uncertainty caused by stakeholder challenges to other projects in the sector, it will be pushed forward.
Carnarvon says it is confident that the matter will be resolved collectively by the industry and government, and looks forward to beginning stakeholder consultations as part of the Dorado EP process in the “not-too-distant future”.
Oil & gas remain critical
Carnarvon managing director and CEO Andrian Cook said “as the demand for energy continues to increase globally, oil and gas remains a critical contributor on the supply side. While the energy transition is progressing, the unshakeable fact is that oil and gas has a strong future and requires significant new investment to meet continued global demand.
“Carnarvon is well placed to play our part in meeting regional energy needs through Dorado and Pavo liquids production, and the development of future gas and liquids discoveries in the Bedout Sub-basin.
“On behalf of the Board and Carnarvon team, we look forward to meeting shareholders and providing an update on the business at the company’s Annual General Meeting at the Perth Exhibition and Convention Centre on 17 November 2023.”