Australia’s Woodside has signed a 7-year LNG supply deal with German energy firm RWE, further underpinning its Scarborough project that will feed the second Pluto train.
The firm said Friday its unit Woodside Energy Trading Singapore will start delivering LNG to RWE Supply & Trading from the company’s global portfolio in 2025.
In addition, Woodside’s unit will supply 0.84 million tonnes per year while the SPA
is not subject to final investment decision on any project, it said.
“Strong demand” for LNG in the second half of this decade
The new deal builds on Woodside’s and RWE’s “strong relationship” developed through existing mid-term and spot business in Asia-Pacific and the Atlantic basin.
Moreover, Woodside executive vice president development and marketing Meg O’Neill said the signing of the SPA with RWE was “further evidence of the strong market demand for LNG in the second half of this decade.”
“Customers are increasingly seeking to secure new energy supplies in a timeframe which supports the development of our Scarborough offshore gas resource and the expansion of the Pluto facility with the addition of a second LNG production train,” O’Neill said.
She added the new deal is another demonstration of the momentum the firm is gathering ahead of its targeted FID on Scarborough and Pluto Train 2 in the second half of this year.
To remind, Woodside revealed a deal with Germany’s Uniper last month doubling the volumes of LNG it plans to supply to the firm.
The new SPA also provides the opportunity for Woodside and RWE to explore the potential for carbon-neutral LNG production and trading, O’Neill added.
Chief commercial officer origination and gas Supply at RWE Supply & Trading Andree Stracke said the new deal demonstrated RWE’s ongoing commitment to expanding its global LNG portfolio.
“The volumes will continue to enable us to deliver effective LNG solutions to our customers and will provide a platform to further advance our existing business in Asia,” he said.
The new deal also follows a memorandum of understanding the duo signed in October last year to discuss mutually beneficial hydrogen-related opportunities.
Woodside says hydrogen is expected to play an increasingly important role in the future global energy mix as a carbon-neutral fuel.
RWE is progressing about 30 hydrogen projects, mostly located in Europe.