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China’s appetite for Australian LNG grows

Mon 08 Apr 2019 by John Snyder

China’s appetite for Australian LNG grows
Woodside executive vice president marketing, trading and shipping Reinhardt Matisons and Enn Energy executive director and CFO Wang Dongzhi at signing ceremony at LNG 2019 in Shanghai (credit: Woodside)

Australia’s Woodside Energy will sell 1 mta of LNG for 10 years commencing in 2025 under a heads of agreement (HOA) with China’s ENN Group.

Woodside Energy chief executive Peter Coleman said the HOA, signed at LNG2019 in Shanghai, builds on an October 2018 co-operation agreement, under which the two companies committed to work together to explore a broad range of potential business opportunities.

“This HOA demonstrates market support for Woodside’s proposals to expand the Pluto LNG facility and develop the Scarborough offshore gas resource as part of our vision for the Burrup Hub in Western Australia,” said Mr Coleman.

Estimated to contain 7.3Tn ft3 of dry gas, the Scarborough gas resource is located in the Carnarvon Basin, approximately 375 km west-northwest of the Burrup Peninsula in Western Australia. Woodside Energy is proposing to develop the Scarborough resource with 12 subsea, high-rate gas wells tied back to a semi-submersible floating production unit moored in 900 m of water close to the Scarborough field. Gas would be transported by a 430-km pipeline to existing LNG infrastructure on the Burrup Peninsula.

Woodside and ENN have built a partnership as both companies pursue growth phases. ENN is aiming to grow its market share in China’s gas distribution and retailing sector, as well as internationally. The HOA remains conditional upon the negotiation and execution of a fully termed sales and purchase agreement and obtaining all necessary approvals and an FID on Scarborough.

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