Woodside to Sell 10% Stake in Scarborough Project to LNG Japan

Tuesday, August 8, 2023

Australian oil and gas giant Woodside has agreed to sell a 10% stake in the Scarborough joint venture in Australia to LJ Scarborough Pty Ltd (LNG Japan).

The Scarborough Joint Venture comprises the Scarborough field and associated offshore and subsea infrastructure. The Scarborough field is located approximately 375 km off the coast of Western Australia.

The Scarborough project will include the installation of a floating production unit with eight wells drilled in the initial phase and thirteen wells drilled over the life of the Scarborough field. The gas will be transported for processing at Pluto LNG through a new trunkline of approximately 430 km in length. The final investment decision was made in November 2021 and first LNG cargo is targeted for 2026.

The purchase price is US$500 million. LNG Japan will reimburse Woodside for its share of expenditure for the Scarborough project from the transaction effective date of January 1, 2022. 

On completion of the transaction, expected in the first quarter of 2024, the estimated total consideration comprising the purchase price, reimbursed expenditure. and escalation is approximately US$880 million. 

Completion of the Transaction is subject to conditions precedent, including Foreign Investment Review Board approval, National Offshore Petroleum Titles Administrator approvals, and Western Australian Government approvals.

12 LNG Cargoes Per Year

Woodside and LNG Japan Corporation have entered into a non-binding heads of agreement for the sale and purchase of 12 LNG cargoes per year (approximately 0.9 million tonnes per annum) for 10 years starting in 2026. 

Woodside has also entered into non-binding agreements to collaborate with Sumitomo Corporation and Sojitz Corporation on global opportunities in new energy which could include ammonia, hydrogen, carbon capture and storage (CCS), and carbon management technology. 

Following completion, Woodside will hold a 90% interest in the Scarborough Joint Venture and remain as operator. Scarborough gas will be processed at the Pluto LNG facility, where Woodside is currently constructing Pluto Train 2. 

Woodside is also operator of the Pluto Train 2 Joint Venture and holds a 51% participating interest. 

LJ Scarborough Pty Ltd is currently a wholly owned subsidiary of LNG Japan Corporation, which is a 50:50 joint venture between Sumitomo Corporation and Sojitz Corporation. 

Woodside CEO Meg O’Neill said: “The support of LNG Japan is a testament to the quality of the Scarborough project. It also underscores the ongoing demand from Japanese buyers for new supplies of gas and the role of gas in supporting Japan’s energy security. 

“Our new energy agreements with Sumitomo and Sojitz provide further opportunities for us to work closely together on our shared decarbonization and energy security ambitions. “Scarborough will be an important source of gas for both the Western Australian and international markets, supporting domestic jobs and providing taxation revenue for the State and Federal Governments. 

“We look forward to working with LNG Japan to deliver this world-class project,” she said. LNG Japan CEO Kyo Onojima said he was excited to form the strategic relationship between LNG Japan and Woodside. 

“We are very pleased to join the Scarborough Joint Venture and are looking forward to finalizing the LNG offtake agreement and exploring business opportunities in the new energy sector,” he said. 

Categories: Energy Industry News Activity Asia Australia/NZ

Related Stories

One Shelf Drilling Rig Up for New Job in India, Other for Disposal

PTTEP Hires Velesto’s Jack-Up Rig for Drilling Campaign off Malaysia

Thailand's PTT to Buy LNG from Glenfarne's Alaska LNG Project

Woodside and Jera Agree LNG Cargoes Supply for Japan’s Winter Period

Yinson Production, “K” LINE Target Europe's CCS with FSIU and LCO2 Solutions

Petronas-Eni Upstream Joint Venture to Take Up to Two Years to Set Up

French Oil Major Acquires Interests in Multiple Blocks in Southeast Asia

Fugro Expands Geotechnical Testing Capabilities in Indonesia

ABL Lands Work on BP’s Indonesian Gas and CCUS Project

Woodside Inks Long-Term LNG Supply Deal with China Resources

Current News

One Shelf Drilling Rig Up for New Job in India, Other for Disposal

Four Jack-Up Drilling Rig Deals Set to Bring In $129M for Borr Drilling

PTTEP Hires Velesto’s Jack-Up Rig for Drilling Campaign off Malaysia

Yinson Production Secures $1.17B Refinancing for FPSO Maria Quitéria

Centrica and Thailand’s PTT Ink Long-Term LNG Supply Deal

Petrovietnam, Partners Sign PSC for Block Off Vietnam

Japan Protests China’s New Oil and Gas Construction Activities in East China Sea

CNOOC Signs Hydrocarbons Exploration and Production Deal with Kazakhstan

Thailand's PTT to Buy LNG from Glenfarne's Alaska LNG Project

Woodside and Jera Agree LNG Cargoes Supply for Japan’s Winter Period

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com