Inpex Australia's new president director Hitoshi Okawa is relishing the opportunity to build the Australian business on the back of the mighty Ichthys liquefied natural gas and condensate project.

Okawa is no stranger to Australia — he smiles and says he “feels part-Aussie”, given he established Inpex’s Perth office in November 1998 and has lived there ever since, apart from a three-and-a-half year period following the completion in 2002 of the first Ichthys drilling campaign.

In 1998, Inpex was unknown in Australia and had no recognised experience as an operator, says Okawa. Ichthys, in his telling, is a story of success against the odds.

Inpex tried to secure a joint venture partner for the initial drilling programme back in 2000 but, with no takers, the company decided to go it alone.

Just before drilling was due to start, Inpex’s logistics base in Broome was hit by a cyclone.

“My colleague called me in Perth and said the office had disappeared. I said, 'excuse me, what do you mean disappeared?' He said it was hit by a cyclone. This was a shock,” says Okawa.

Remote location

After the initial three discovery wells, the corporation’s management in Tokyo questioned how it would be possible to commercialise a field in such a remote location in the Browse basin.

An independent resource assessment in 2004-2005 confirming significant resources at Ichthys was key to Inpex pursuing the development.

The Maret Islands in the Kimberley region was the company’s initial choice as a location for the LNG facility.

But then the Northern Territory government started lobbying Inpex to use Darwin as an LNG site, while the Western Australian government complicated matters by suggesting it wanted to build an LNG hub in the Kimberley.

Timely access to land then became the critical issue.

“In September 2008 we made a final decision to go to Darwin. It was a difficult decision for us, but everything came together in terms of access to land, infrastructure and the support of the government and community,” says Okawa.

One of his fondest memories from that time is the strong relationships built with local traditional owners.

He says there are cultural similarities between the Japanese and the Aboriginals – both are ancient cultures that value respect and trust.

The Ichthys project was sanctioned in January 2012 and construction began soon after.

Okawa says one of the biggest development challenges was project financing. The company completed a US$20 billion deal with more than 30 financial institutions, making it the world’s largest project funding at the time.

Another challenge was recruiting a project team.

“At that time, Western Australia was in a resources boom, which limited the available human resources, and as a company, Inpex was not known. People were asking, who is Inpex?” he says.

Another big challenge was how to implement the company's safety culture — Anzen Dai Ichi — across an international workforce that at its peak numbered 30,000.

“It was truly a global enterprise, with nearly every part of the world contributing specialist equipment and expertise,” he says.

The offshore facilities and subsea structures are among the largest and most advanced in the world.

Inpex plans for these colossal facilities to push gas and condensate through the subsea gas pipeline, which at 890 kilometres is the longest in the southern hemisphere, for the next 40 years.

Okawa is proud of the positive impact Inpex has had on the Northern Territory.

“We were transparent, always telling communities what we were doing, and always doing our best to take into account requests from the community and the traditional owners, particularly the Larrakia people.”

The US$40 billion development came on stream in July 2018 and is firmly at the centre of Inpex’s global portfolio.

“Australia has become a centre of excellence for the company, and from here we will provide support to our projects around the world,” Okawa says.

Production wells

Activity levels at Ichthys remain high. The first phase of 18 production wells will be followed by subsequent phases of up to 32 wells, for which the drilling rig Maersk Deliverer has been contracted from 2020 for three years.

Inpex has a host of exploration permits and undeveloped discoveries in the Ichthys field and nearby acreage.

The company is also pursuing an onshore exploration permit application in the Beetaloo basin, which it believes has tremendous gas potential.

Okawa says the onshore site in Darwin has land tenure for four more LNG trains, which “allows for the accelerated development of more gas. Also, the gas export pipeline has five hot-tap tie-in points along the route”.

The immediate priority is keeping the current two trains full and maximising cash flow, he says.

Okawa has become very fond of Australia, having lived there for 17 years. He enjoys the barbecue tradition, the golf courses, the scenery — and the non-dangerous wildlife.

He has developed a taste for Vegemite, although spreads it very thinly, unlike his first try when he slathered it on like jam.

Later this year, he will host Inpex’s first-ever board of director’s meeting outside of Tokyo. It will be in Darwin, where the board members will gain an understanding of the Ichthys working environment — and just maybe try some Vegemite.

Weekly

How Okawa became Inpex's wizard of Oz