SK Innovation E&S Secures Stable LNG Supply from Australia for Korea
SK Innovation E&S secured a long-term supply of liquefied natural gas (LNG) from Australia for Korea, reducing its reliance on Middle Eastern imports. The company holds a 25% equity stake in the Darwin LNG terminal and 37.5% in the Barossa gas field, which produces 3.5 million tons of LNG annually.
The Barossa gas field, located about 300 km offshore from Australia's northern coast, began producing natural gas last year after a 14-year development period. SK Innovation E&S secured 1.3 million tons per year of LNG and 1.1 million barrels of condensate through its equity stake.
The Darwin LNG terminal, where the company acquired a 25% equity stake in 2020 for about $380 million, is a key facility that liquefies and stores natural gas from the Barossa field for shipment to Korea and other destinations. SK Innovation E&S's investment in Australia reduces its reliance on Middle Eastern imports and lowers logistics burdens associated with long-distance shipping.
Kim Hyun-jun, a technical committee member in the LNG Business Division at SK Innovation E&S, said that by securing equity in the Darwin LNG terminal, the company can ensure stable volumes and supply stability without purchasing LNG on the spot market. The Barossa gas field is also considered a low-geopolitical-risk production base due to its location.