Australia’s Woodside and its Pluto LNG joint venture partners have delivered their first cargo of carbon offset condensate to independent commodity trader Trafigura.
The partners include units of Japan’s Kansai Electric Power and Tokyo Gas.
Woodside said Monday it loaded the cargo at its Pluto LNG plant located on the Burrup Peninsula near Karratha, in Western Australia.
Moreover, the partners would offset the carbon dioxide equivalent emissions associated with extraction, storage, and shipping of the 650,000-barrel cargo through a combination of efficiency measures but also surrender of high-quality carbon offsets, according to Woodside.
In addition, Trafigura is working with the vessel owner to minimise actual emissions associated with transporting the cargo, it said.
The Australian LNG firm says carbon offsets have been sourced from nature-based projects located in the Asia-Pacific region, and “independently validated and verified by the Gold Standard or Verified Carbon Standard.”
Trafigura and Woodside will jointly calculate carbon dioxide equivalent emissions generated by extraction, storage and shipping of the cargo.
Woodside, as the operator of Pluto LNG, will calculate emissions associated with extraction and storage, while Trafigura will calculate the shipping emissions, specific to the cargo voyage.
“World’s first carbon offset condensate cargo”
Woodside vice president marketing trading and shipping Mark Abbotsford said this could mark the first carbon offset condensate cargo traded globally, “demonstrating opportunities for carbon offset condensate.”
“The transaction provided an opportunity to further develop our carbon offset
marketing capability and gain an understanding of the carbon market in its early phases,” he said.
In addition to the transaction, the two firms have signed a non-binding memorandum of understanding to explore opportunities for carbon management in the marketing of carbon offset condensate, crude oil, and liquefied petroleum gas in the future.
Dmitri Croitor, global head of naphtha and condensates for Trafigura, said the firm has set “ambitious targets” to reduce its operational greenhouse gas emissions and this deal with Woodside helps to “offset emissions associated with the cargo from wellhead to delivery.“
Furthermore, Trafigura would continue to develop this offering for “other oil products for our customers around the world,” he said.