Australia’s Woodside reported lower sales revenue in the third quarter, while its Scarborough and Pluto LNG Train 2 project, worth about $12 billion, is now 46 percent complete.
In November 2021, Woodside took a final investment decision on the Scarborough and Pluto LNG Train 2 developments and the project was 38 percent complete as of the end of the second quarter this year.
The project also include new domestic gas facilities and modifications to the first train.
Woodside’s Pluto LNG terminal currently has one train with a capacity of 4.9 mtpa and Woodside and US engineering and construction firm Bechtel started building the second Pluto train last year.
Pluto Train 2 will get gas from the Scarborough gas field, located about 375 km off the coast of Western Australia, through a new trunkline long about 430 km.
The company’s CEO Meg O’Neill said in the third-quarter results report on Wednesday that “activity at Scarborough and Pluto Train 2 increased as planned and the project is now 46 percent complete.”
Also, installation of the nearshore component of the Scarborough trunkline started and fabrication of the floating production unit topsides and hull continued.
Site construction works for Pluto Train 2 are progressing, and Woodside expects to receive the first module from Indonesia at the project site in Dampier in the first quarter of 2024.
First LNG cargo in 2026
“The Federal Court’s September 28 decision that the Commonwealth Environment Plan for the Scarborough offshore seismic survey is invalid has not impacted our target for first LNG cargo in 2026,” O’Neill said.
The decision does however highlight the urgent need for reform of Australia’s offshore approvals process, she said.
“Uncertainty over approvals has the potential to add cost and delays to any offshore activities to be undertaken in Australia. In the case of gas projects, such uncertainty threatens the delivery of much-needed new supplies to the Western Australian domestic market, as well as undermining the confidence of our regional trading partners,” O’Neill said.
Woodside’s CEO said the importance of Scarborough to regional energy security was demonstrated in August when LNG Japan agreed to purchase a 10 percent non-participating interest in the joint venture.
As part of the broader strategic relationship, Woodside and 50:50 JV between Sumitomo and Sojitz also entered into a non-binding heads of agreement for the sale and purchase of 12 LNG cargoes per year, or about 0.9 million tonnes per year.
Sales revenue down
Woodside said its third-quarter sales revenue dropped by 44 percent year-on-year to $3.26 billion, while it rose by 6 percent when compared to the prior quarter.
The LNG producer said the rise from the previous quarter is due to higher production offset by lower realized prices.
Woodside achieved a portfolio average realized price of $60.2/boe.
Quarterly production of 47.8 MMboe (520 Mboe/day) rose 8 percent from the prior quarter due to completion of planned turnaround and maintenance activities, it said.
Production dropped by 7 percent compared to the same period last year.
O’Neill said “strong” operating results at Pluto LNG underpinned the quarter-on-quarter increase in output.
“The 99.9 percent reliability achieved at Pluto during the third quarter followed the completion of a maintenance turnaround in June,” she said.
She added that planned turnaround and maintenance activities in the quarter affected production at North West Shelf, but the facility’s reliability was “still exceptional at 98.9 percent.”