Will Barossa backfill Darwin LNG?

Will ConocoPhillips and its partners invest in the 3-tcf Barossa field offshore Australia to backfill the Darwin LNG plant, or will it be left to roll off contracts in 2022 and go empty? On the one hand, a backfill development should be globally cost-competitive to supply the LNG market post-2023, versus greenfield projects elsewhere. But on the other, is the project attractive and important enough to the current joint venture (JV) to justify US$4.4 billion in new capex? We have modelled our version of this project plan, and with US$4.4 billion of spend to first gas it's not a small development. An IRR of 16% and NPV15 breakeven of US$8.17/mcf mean it stands in tricky territory: good enough to progress to FEED, but still far from certain. Progression to FID will depend on the commitment of the JV to the project. The alternative, of letting the Darwin LNG facility go empty, is undesirable. For the key participants, the project is fast approaching a 'do-it-or-sell-it' juncture.