Alison Bevege – Energy giant Santos has given the green light to expand its Bayu Undan gas project in the Timor Sea and has increased its gas exports from Darwin's Wickham Point LNG plant.

Bayu Undan has been in production since April 2004 in the joint petroleum development area of the Timor Sea, located 500km northwest of Darwin. Gas from the project is transported to Darwin by pipeline, liquefied at Wickham Point then exported to Japanese firms Tokyo Electric and Tokyo Gas.

ConocoPhillips is the operator of the project with Santos a minority investor in Darwin LNG alongside Inpex.

Santos has now made a final investment decision to build two new wells linked to the existing platform at Bayu Undan, it has revealed in its third quarter activities report. The Bayu Undan Phase 3 development is designed to improve offshore well capacity.

Detailed engineering and procurement activities is now expected to begin. First gas is expected to flow from the third phase in 2015, the energy giant's report to the Australian Securities Exchange said.

Santos reported that Bayu Undan produced 59 petajoules of gas in the three months to September, a 3 per cent increase on the same quarter last year thanks to increased efficiency following the 2012 maintenance shutdown.

Because Santos is a minority owner in the project, it is not entitled to the entire amount. Santos exported 4.6 petajoules of gas from Darwin's Wickham Point LNG plant in the three months to September, an increase on the 4.3 petajoules in the same quarter last year.