Woodside to offload 49% stake in Australian LNG project to GIP
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Woodside to offload 49% stake in Australian LNG project to GIP

15 Nov 2021 (Last Updated November 15th, 2021 14:51)

The Australian firm will continue to hold operatorship stake of 51% in the 5Mtpa Pluto train 2 JV.

Australian natural gas producer Woodside Woodside has agreed to sell a 49% stake in the Pluto Train 2 joint venture (JV) to Global Infrastructure Partners (GIP).

Pursuant to the JV arrangements, GIP will fund an additional amount of approximately $835m in construction capital expenditure.

Woodside said in a statement: “The final quantum of GIP’s capital contribution is dependent on interest rate swap and foreign exchange rates on the date of the final investment decisions for Scarborough and Pluto Train 2.”

Estimated to cost $5.6bn, the Pluto Train 2 involves the construction of an LNG train and domestic gas facilities at the existing Pluto LNG onshore facility located on the Burrup Peninsula.

Upon the completion of the deal, Woodside will continue to hold an operatorship stake of 51% in the Pluto train 2 JV.

Woodside CEO Meg O’Neill said: “The LNG supplied from the expanded Pluto facility will assist our customers to achieve their decarbonisation goals through the energy transition.

“The sale of the interest in Pluto Train 2 is a significant milestone as we progress towards a final investment decision on our Scarborough development, further de-risking this globally competitive investment.”

The deal is subject to final investment decisions for the Pluto train II and Scarborough developments, Foreign Investment Review Board approval, signing of Scarborough processing and services agreement, as well as relevant government and regulatory approvals.

It is planned for completion in January 2022.

With a capacity of five million tonnes per annum (Mtpa), the Pluto train 2 will process natural gas sourced from the Scarborough field located in the Carnarvon Basin in the Northwestern Shelf, offshore Western Australia.

O’Neill added: “The development of Scarborough gas through Pluto Train 2 will deliver significant value to our shareholders, create thousands of jobs in Western Australia and generate tax revenues for decades to come.

“Pluto Train 2 will be one of Australia’s most efficient LNG trains and with Scarborough gas containing virtually no carbon dioxide, this is an attractive investment in a decarbonising world.”

Meanwhile, in a separate development, GIP has agreed to divest a stake of 25.7% interest in Freeport LNG to JERA Americas in a deal worth $2.5bn.

This stake was acquired by GIP’s second flagship fund, Global Infrastructure Partners II, in 2015.

Freeport LNG Development owns and operates an LNG export facility located on Quintana Island, near Freeport, Texas, US.

Currently, JERA, through its subsidiaries, holds a stake of 25% in the Freeport LNG train 1.

JERA expects the acquisition to secure it with a stable LNG supply.

Completion of the deal is subject to customary regulatory approvals and closing conditions.