Australia’s Woodside and its North West Shelf LNG venture partners signed two agreements to process gas through the project’s facilities in Western Australia.
The joint venture partners signed fully-termed gas processing deals with a unit of Woodside to process gas from the Pluto fields and with units of Mitsui & Co and Beach Energy in respect of the Waitsia Gas Project Stage 2.
The move follows non-binding deals revealed in August this year.
Australia’s oldest LNG plant at Karratha, part of the Woodside-led North West Shelf project, has been liquefying gas from fields located off the north-west coast of Australia for more than 30 years.
Hovewher, these fields are slowly running out of gas and the project is now shifting its focus towards a different business model aimed at processing gas from third parties.
Under the deal with Woodside Burrup, operator of the Pluto LNG terminal, the Karratha plant will process about 3 million tonnes of LNG and 24.7 petajoules of domestic gas in the period 2022-2025 from the offshore Pluto field.
This gas would reach the Karratha plant through the proposed Pluto-KGP Interconnector, which is targeting start-up in 2022.
Furthermore, the deal with Mitsui E&P Australia and Beach Energy includes processing services for gas from the onshore Waitsia Gas Project Stage 2.
The Karratha plant will process about 7.5 million tonnes of LNG over five years starting in the second half of 2023.
In support of the two tolling deals, the NWS LNG partners have also taken a final investment decision for the infrastructure required to receive gas.
This includes the Pluto-KGP Interconnector and the Burrup Extension Pipeline, which will be utilised for Waitsia gas.
Woodside CEO Peter Coleman said the transformation of the Karratha plant into a third-party tolling facility would create new opportunities for Western Australia’s gas industry.
Additionally, the CEO said the processing of third-party gas resources would unlock further value for the NWS project.
“It will provide new revenue and LNG exports from the NWS project, add to Western Australia’s domestic gas supplies from Pluto and help underpin Australia’s economic recovery,” Coleman said.
The Karratha gas plant has five LNG trains with a capacity of 16.9 million tonnes per year. The facility also features domestic gas trains, condensate stabilisation units and LPG units.
Besides operator Woodside, other partners in the NWS project include Chevron, BP, Shell, BHP, and Japan Australia LNG.