Inpex Holdings Inc., Japan's largest energy explorer, has picked Darwin in Australia's Northern Territory as the onshore site for a $20 billion liquefied natural gas project, moving the venture closer to development.
Inpex and partner Total SA will start initial plant engineering work "soon," the Tokyo-based company said Friday.
The plant will be designed to initially produce more than 8 million metric tons of LNG a year, with output due to start by early 2015.
Global consumption of LNG is set to increase 10 percent a year through 2015, more than five times the estimated gain in crude oil demand, Citigroup Inc. said in April, as utilities switch to cleaner fuel for power generation. Should the Ichthys project go ahead, it will be Inpex's largest investment in Australia and the biggest project in the Northern Territory.
"Environmental, economic and engineering studies have demonstrated the viability of locating an LNG plant at Blaydin Point and have lent weight to this decision," said Naoki Kuroda, president of Inpex. A final investment decision will be made in late 2009 or early 2010, he said.
Inpex expects the total cost of the project to exceed $20 billion, the statement said.