June 29 (Reuters) - Australian gas producer Santos (STO) kicked...

June 29 (Reuters) - Australian gas producer Santos (STO) kicked off the front-end engineering design (FEED) process for its Dorado oil project on Tuesday, and said the first phase of the project will cost about $2 billion.

The Western Australian project, which contains 150 million barrels of contingent, so-called 2C oil resources, is expected to have an initial gross oil production rate of between 75,000 barrels and 100,000 barrels per day, the company said.

Santos Chief Executive Officer Kevin Gallagher said the project is on schedule for a final investment decision around mid-2022, building on the company's $3.6 billion investment decision for its Barossa gas project off northern Australia in March.

"After the initial phase of liquids production, gas export from the development allows for a future source of supply into our domestic gas infrastructure in Western Australia, " Gallagher added.

Santos is also looking for buyers for a portion of its 80% stake in the project, as well as other oil assets in Western Australia. Carnarvon Petroleum (CVN) holds the remaining 20% stake in Dorado.

Contractors for the remaining stages of the first phase will be finalized over the next few months, Santos said.