The first shipment from Darwin marks the start of production from Australia’s second LNG export project, 17 years after the North West Shelf started exporting to Japan in 1989.

Completed on budget and one month early, the A$2 billion Darwin LNG project is the second phase of development for the Bayu Undan gas fields in the Timor Sea, about 500km northwest of Darwin.

An LNG carrier will arrive at the load-out facility in Darwin every seven to 10 days.

The partners plan to sell at least three trial cargoes into the LNG spot market before beginning contracted sales.

Darwin LNG has contracts to supply Tokyo Electric and Tokyon Gas with about 3 million tonnes of LNG per year for 17 years.

Under the deal, the producers can also sell some spot cargoes to other customers. Tokyo Gas also has LNG contracts with the North West Shelf project, Gorgon and the planned Pluto project.

The Wickham Point site has approval to produce 10 million tonnes of LNG per year. ConocoPhillips is currently pursuing new gas supplies for an expansion.

With a 10.64% interest, Santos is the only direct Australian investor in the project. The other partners are ConocoPhillips (operater - 56.7%), Eni (12.1%), Tokyo Timor Sea Resources (comprising Tokyo Electric Power and Tokyo Gas - 10.1%), and Inpex (10.5%).