BNP Paribas and Bank of Korea cut ties with Santos’ Barossa gas project
BNP Paribas and The Export-Import Bank of Korea, two major international banks, have ended their financial support for Santos’ Barossa gas project.
BNP Paribas, the world’s ninth-largest bank based in France, is no longer serving as the energy giant’s financial adviser. Additionally, the Export-Import Bank of Korea (KEXIM) has confirmed it has not renewed its loans to SK E&S, the oil and gas subsidiary of Santos’ South Korean partner, SK.
In an email to The Sydney Morning Herald, BNP Paribas confirmed that it has withdrawn from financing the Barossa gas project. The bank’s role as a financial adviser included coordinating banks and financial terms with the project owners.
Joshua Runciman, lead gas analyst at the Institute for Energy Economics and Financial Analysis, noted that BNP Paribas’s decision not to back the Barossa gas project followed its recent exit from the proposed Papua LNG project.
Read more: BNP Paribas AM and other asset managers appeal for enhanced ocean-related data
“Based on our analysis, Santos’ Barossa project is at risk of delivering suboptimal financial returns. The project’s costs have already risen, and Santos will incur additional expenses to mitigate the high CO2 content of the Barossa field,” The Sydney Morning Herald, an Australian news outlet, reports.
Earlier in January 2024, Santos won in the Federal Court, where a judge ruled against arguments that the proposed pipeline would harm Tiwi Islanders’ Sea Country and upset their cultural beliefs regarding two sacred creatures from their Dreaming stories.
In a February 2024 investor update, Santos CEO Kevin Gallagher announced that the Barossa gas project had reached 67% completion, with the first gas anticipated to be delivered in the third quarter of 2025.
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