Inpex approves US$34bn Ichtys LNG project in Australia

Japan-based Inpex Corp gave the green light for the US$34bn LNG export project that is expected to make Australia the world’s top exporter of the fuel by 2017, surpassing current no. 1 Qatar.

The 8.4Mta project will pipe gas from the Timor Sea to the coast city of Darwin in Australia’s Northern Territory. The project is a joint venture between Inpex (72.805% stake) and Total (24%) while Tokyo Gas, Osaka Gas and Toho Gas all have small stakes. Inpex is reportedly in talks with Total, which has expressed interest in increasing its stake to 30%.

Inpex said the cost was higher than previously estimated by its partner, French energy firm Total, as it has now more reliable information from the front-end engineering design. “I think we have a highly accurate cost estimate,” Inpex President Toshiaki Kitamura told reporters in Tokyo. “The $34 billion capex ensures sufficient economic efficiency.”

The project is one of eight LNG projects under way in Australia, which will see its capacity quadruple from 20.1Mta to 80Mta in 2017. The rush has already led to cost blow-outs and labour shortages.