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Woodside said on Wednesday that this agreement represents the first tranche of a diversified portfolio of feed gas that will support the Louisiana LNG project, enabled by the project’s extensive interconnectivity to multiple producing basins and interconnecting pipelines.
Under the agreement, Louisiana LNG Gas Management (GasCo), a wholly-owned subsidiary of Louisiana LNG, has committed to purchase on a long-term basis up to 640 billion cubic feet of gas from BP for an ultimate delivery to Line 200 beginning in 2029.
Woodside said GasCo will be responsible for implementing the gas sourcing strategy to support the Louisiana LNG project.
BP markets the natural gas produced by BPX Energy, its US onshore business, which has a material asset base in the core of the best US onshore basins, including the Haynesville basin.
Woodside’s CEO Meg O’Neill said the agreement marks another milestone for the Louisiana LNG project.
“Louisiana LNG is a compelling investment, expected to deliver significant cash generation and create long-term shareholder value. Securing this gas supply agreement is an important step for the project,” she said.
“Woodside has a long history of successful collaboration with BP. By drawing upon BP’s experience with MiQ certificates, we can access verifiably low methane intensity molecules for the Louisiana LNG project. This supports Woodside’s goals as a member in the UN Environment Programme’s OGMP 2.0 initiative,” O’Neill.
FID
The gas supply agreement comes just one day after Woodside made a final investment decision to develop the three-train Louisiana LNG project.
The total capital expenditure for the LNG project, pipeline, and management reserve is $17.5 billion.
US private equity firm Stonepeak, as an investor in Louisiana LNG Infrastructure LLC, will provide $5.7 billion towards the expected capital expenditure for the LNG project on an accelerated basis, contributing 75 percent of capital expenditure in both 2025 and 2026, Woodside said.
Earlier this month, Woodside agreed to sell 40 percent of its Louisiana LNG project to Stonepeak.
Woodside’s share of the forecast total capital expenditure is $11.8 billion.
Woodside is targeting its first LNG in 2029.