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Woodside Energy Group Ltd
ACN 004 898 962
Mia Yellagonga
11 Mount Street
Perth WA 6000
Australia
T +61 8 9348 4000
www.woodside.com
ASX: WDS
NYSE: WDS
LSE: WDS
Announcement
Friday, 23 February 2024
WOODSIDE TO SELL 15.1% SCARBOROUGH INTEREST TO
JERA
Woodside has broadened its strategic
relationship with JERA through a transaction that involves three
core elements: equity in the Scarborough Joint Venture; LNG
offtake; and collaboration on opportunities in new energy and lower
carbon services.[1]
Woodside has executed a binding sale and
purchase agreement with JERA for the sale of a 15.1% non-operating
participating interest in the Scarborough Joint Venture (JV) for an
estimated total consideration of US$1,400 million.[2] This comprises the purchase price of
approximately $740 million, and reimbursement to Woodside for
JERA's share of expenditure incurred from the transaction effective
date of 1 January 2022. Completion of the transaction is expected
in the second half of 2024.
Woodside and JERA have also entered into
a non-binding heads of agreement for the sale and
purchase of six LNG cargoes on a delivered ex-ship basis per year
for 10 years commencing in 2026 from Woodside's global
portfolio.
A non-binding agreement for new energy
collaboration including potential opportunities in ammonia, hydrogen, carbon management technology and carbon
capture and storage was also signed to support common
decarbonisation ambitions.
Woodside CEO Meg O'Neill welcomed the broadened
strategic relationship with JERA.
"Woodside welcomes Japan's largest utility,
JERA, into the Scarborough Joint Venture. This builds on a long
history of collaboration, starting in 1989 with LNG sales from the
North West Shelf to JERA's parent companies Tokyo Electric and
Chubu Electric.
"JERA's participation in the Scarborough Joint
Venture, which will also include LNG Japan, is a further
demonstration of the importance of the project to Japanese
customers and confidence in long-term demand.
"Scarborough is a world-class project which
will provide reliable energy for our customers in the Asian region,
including in Japan. LNG continues to be an important energy source
for Japan and one which supports the country's decarbonisation
ambitions.
"In Australia, the Scarborough Energy Project
will provide local jobs and contracting opportunities and deliver
tax revenue to State and Federal Governments.
"We are also looking forward to exploring new
energy and business opportunities alongside JERA. These have the
potential to further our shared ambitions to develop new energy
value chains between Australia and Japan," she said.
Yukio Kani, JERA Global CEO and Chair said,
"Solving the world's energy issues requires deep collaboration to
tackle challenges one by one with reliable partners. I am grateful
for the open and engaging dialogue I have had with Woodside CEO Meg
O'Neill. I look forward to further developing our relationship with
Woodside, a global player in LNG, and to promote new initiatives to
achieve decarbonisation."
Completion of the Scarborough equity
transaction is subject to conditions precedent including Foreign
Investment Review Board approval, National Offshore Petroleum
Titles Administrator approvals, Western Australian Government
approvals and satisfaction of requisite financing
approvals.
The transaction also includes an option for
JERA to acquire a 15.1% non-operating participating interest in the
Thebe and Jupiter fields as well as a non-binding agreement that
outlines a long-term collaboration to pursue opportunities for
additional feed gas and joint investment in offshore gas fields for
future tieback to the Pluto LNG facility via Scarborough
infrastructure. A non-binding agreement has also been signed for
Woodside to provide carbon management services to assist JERA to
meet its obligations associated with its share of carbon emissions
from the Scarborough Joint Venture.
Following completion of the sale of equity to
JERA, Woodside will hold a 74.9% interest in the Scarborough Joint
Venture and remain as operator.[3]
About
Scarborough
The Scarborough Energy Project comprises the
Scarborough Joint Venture, the Pluto Train 2 Joint Venture and
modifications to Pluto Train 1 to process Scarborough gas. The
Scarborough Joint Venture includes the Scarborough field and
associated offshore and subsea infrastructure.
The Scarborough field is located approximately
375 km off the coast of Western Australia and the reservoir
contains less than 0.1% carbon dioxide. Scarborough gas will be
processed at the Pluto LNG facility, where Woodside is currently
constructing Pluto Train 2. Woodside is operator of Pluto LNG and
Pluto Train 2.
In August 2023, Woodside entered into a sale
and purchase agreement with LNG Japan for the sale of a 10%
non-operating participating interest in the Scarborough Joint
Venture.3
About
JERA
Established in 2015, JERA is an equal joint
venture of two major Japanese electric power companies, TEPCO Fuel
& Power Incorporated and Chubu Electric Power Company and
produces about 30% of all electricity in Japan. JERA is an energy
company with global reach that has strength in the entire energy
supply chain, from participation in LNG upstream projects and fuel
procurement, through fuel transportation to power generation. JERA,
which stands for Japan's Energy for a New Era, will take on the
challenge of achieving net zero CO2 emissions from its
domestic and overseas businesses by 2050 and is supporting an
energy transition in an environmentally and socially responsible
manner. For more details:
https://www.jera.co.jp/english
Contacts:
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INVESTORS
Marcela Louzada
M: +61 456 994 243
E: investor@woodside.com
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MEDIA
Christine Forster
M: +61 484 112 469
E:
christine.forster@woodside.com
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This announcement was approved and authorised for release by
Woodside's Disclosure Committee
Forward-looking
statements
This announcement contains forward-looking
statements with respect to Woodside's
business and operations, market conditions, results of
operations and financial condition, including, for
example, but not limited to, statements regarding the transaction
(including statements concerning the timing and completion of the
transaction, the expected benefits of the transaction and other
future arrangements between Woodside and JERA), the timing of
completion of other transactions, the timing of completion of
Woodside's projects and expectations regarding future expenditures
and future results of projects. All forward-looking
statements contained in this announcement reflect
Woodside's views held as at the date of this
announcement. All statements, other than statements of historical
or present facts, are forward-looking statements and generally may
be identified by the use of forward-looking words such as
'guidance', 'foresee', 'likely', 'potential', 'anticipate',
'believe', 'aim', 'estimate', 'expect', 'intend', 'may', 'target',
'plan', 'forecast', 'project', 'schedule', 'will', 'should',
'seek' and other similar words or
expressions.
Forward-looking statements in this announcement
are not guidance, forecasts, guarantees or predictions of future
events or performance, but are in the nature of aspirational
targets that Woodside has set for itself and its management of the
business. Those statements and any assumptions on which they
are based are only opinions, are subject to change without notice
and are subject to inherent known and unknown risks, uncertainties,
assumptions and other factors, many of which are beyond the control
of Woodside, its related bodies corporate and their respective
officers, directors, employees, advisers or
representatives.
Details of the key risks relating to Woodside
and its business can be found in the
"Risk" section
of Woodside's most recent Annual Report
released to the Australian Securities Exchange and the London Stock
Exchange and in Woodside's most recent
Annual Report on Form 20-F filed with the United States Securities
and Exchange Commission and available on the Woodside website at
https://www.woodside.com/investors/reports-investor-briefings. You
should review and have regard to these risks when considering the
information contained in this announcement.
Investors are strongly cautioned not to place
undue reliance on any forward-looking statements. Actual results or
performance may vary materially from those expressed in, or implied
by, any forward-looking statements.
All information included in this announcement,
including any forward-looking statements, speak only as of the date
of this announcement and, except as required by law or regulation,
Woodside does not undertake to update or revise any information or
forward-looking statements contained in this announcement, whether
as a result of new information, future events, or
otherwise.
Announcement
contains inside information
This announcement contains inside information.
Marcela Louzada, Vice President Investor Relations is responsible
for release of this announcement.