“The decision to proceed with FEED demonstrates the attractiveness of our Bowen Basin reserves,” Arrow CEO Andrew Faulkner said.
“This design stage represents an important step forward for Arrow’s Bowen gas project and I expect FEED work will take around 12 months to complete.”
He said the project also represented a major expansion in CSG production volumes.
The project area is adjacent to the Arrow and AGL-owned (50:50) Moranbah gas project, which has been producing CSG for the domestic market since 2004.
Faulkner revealed that development options for the company’s Surat Basin reserves further north were also making progress.
He said collaboration discussions with third parties were continuing “to identify the best option for monetising Arrow’s gas reserves in both the Surat and Bowen basins”
While the FEED process will provide more production parameters, Arrow previously flagged that the Bowen project could have up to 6625 production wells over a 40-year life.
“The first stage is expected to involve the initial development of up to four development areas coming online in 2017, with up to approximately 600 production wells likely to be drilled in the first two years,” Arrow said in its draft environmental impact statement for the project.
Earlier this year Arrow stalled its LNG development plans amid reports of mass lay-offs.
There are some industry views that Arrow’s 50:50 owners Royal Dutch Shell and PetroChina are waiting for a lower cost environment to emerge once the other LNG projects are built on the island.
