Beach pens Waitsia deal with Webuild

Australia’s Beach Energy has signed a deal with Italy’s Webuild to complete the second stage of the Waitsia gas project in Western Australia.

A unit of Japan’s Mitsui & Co, the operator of the the Waitsia Stage 2 project, and Beach took a final investment decision on the expansion project in December 2020.

Prior to that, the partners signed third-party tolling deals with Australia’s Woodside and its North West Shelf LNG venture participants.

Last year, Beach also finalized a deal to supply LNG to a unit of energy giant BP.

Mitsui E&P Australia and Beach previously awarded the engineering, procurement and construction gig to Australian contractor Clough.

However, Clough was placed into voluntary administration in December last year after a deal by its parent Murray & Roberts and Webuild fell through.

Webuild said last week it signed a contract with the Deloitte Administrators of Clough to acquire Clough assets and now the firm reached the deal with Beach to complete delivery of the Waitsia Stage 2 project.

Beach said in a statement issued on Monday that the deal remains subject to finalization of the Clough administration.

Following Webuild’s due diligence and review of cost and work schedules, Beach has revised its total capital expenditure estimate to A$400 – A450 million net to Beach (A$350 – A400 million originally) with the Waitsia JV and Webuild targeting first gas from the Waitsia gas plant by the end of 2023, it said.

Beach said the JV partners have worked with Clough administrators to “ensure employee wages, subcontractors and suppliers continue to get paid, allowing the Waitsia gas plant construction to continue during this difficult time.”

The firm added that Webuild’s acquisition of Clough and its personnel, systems and processes would enable project execution to continue uninterrupted.

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