Woodside to sell US$1.4bil stake in gas project

. — Reuters

SYDNEY: Woodside Energy Group Ltd agreed to a US$1.4bil deal to sell a 15.1% stake in its flagship Scarborough liquefied natural gas (LNG) project to Jera Co, Japan’s biggest power producer, as consumers aim to secure long-term supply.

The accord includes a US$740mil purchase price and reimbursement for spending on the project off the coast of Western Australia, the Perth-based supplier said last Friday in a statement.

It follows the sale last year of a 10% stake in the controversial development to LNG Japan Corp, owned by trading houses Sumitomo Corp and Sojitz Corp.

Jera’s purchase “is a further demonstration of the importance of the project to Japanese customers and confidence in long-term demand,” Woodside Chief Executive Offer Meg O’Neill said in the statement.

Woodside rose 0.3% last Friday, in Sydney, reversing an earlier decline of as much as 1.7%.

Scarborough, which is scheduled to deliver its first LNG shipment in 2026, is forecast to produce as much as eight million tonnes a year of the heating and power plant fuel.

The development has become a target for climate activists opposed to the development of new fossil fuel projects.

Woodside also entered a non-binding agreement for Jera to purchase six LNG shipments a year from its portfolio for 10 years from 2026, according to last Friday’s statement.

Japan, the world’s second-biggest LNG buyer, is moving to secure more gas after the 2022 energy crisis pushed the government to press companies to lock in supply and invest in projects.

A recent decision by the United States to pause approvals for future export projects also prompted some Japanese buyers to begin looking for alternative sources. Jera, one of the world’s biggest LNG importers, has said that the move could cause concerns for global energy security.

The Scarborough acquisition will “contribute to the stable supply of energy in Japan, and Asia as a whole”, Yuichiro Kato, an executive officer at Jera, said at a press briefing last Friday. — Bloomberg

Follow us on our official WhatsApp channel for breaking news alerts and key updates!

Next In Business News

DNB denies claims of impropriety over 5G rollout
Oil gains as Iran downplays reported Israeli attack
Maxis pledges full support to government’s 5G delivery model
Fajarbaru Builder secures RM13mil job
MKH Oil Palm IPO oversubscribed
Making the Malaysian startup pitch
The pros and cons of earned wage access
Making every load lighter
Batik, chips and tech in the fabric of society
How Sin-Kung leveraged air cargo for its success

Others Also Read