The unlevered FOB breakeven is split by plant, upstream, grid and transport cost for all operational and under-construction LNG plants as well as select pre-FID projects at 10%, 12% and 15% discount rates.

The FOB breakeven price is the gas/LNG price (in present-day terms) required for the project (or project phase) to achieve a target IRR over the full life cycle of the project. These are unlevered (i.e. exclude financing costs), post-tax, and discounted from the point of first capital investment. We exclude historical sunk costs and any cost overruns not borne by the project. Oil and local market gas prices are fixed with just the LNG price varied. Where there is significant liquids revenue, the gas breakeven price is often zero.

In integrated projects (where costs and revenue for both the upstream and plant developments are included in the same tax ringfence), the split between plant and upstream breakeven is calculated based on the ratio of plant opex and capex vs upstream opex and capex. For example, Australia Pacific LNG (APLNG) is an integrated project where the LNG plant and upstream supply were developed as one. Our economic analysis of APLNG calculates that 66% of total project costs (both opex and capex) are attributed to the plant, and so 66% of the total breakeven price is attributed to the plant breakeven price. Similarly, the upstream breakeven price is calculated as 34% of the total breakeven price.