Woodside backs Pluto or NWS for Scarborough gas development

Woodside says its North West Shelf (NWS) and Pluto Projects are being seriously considered for the development of the Scarborough LNG joint venture.

According to the Australian Financial Review, Scarborough project partners ExxonMobil and BHP Billiton have been considering a floating LNG (FLNG) development of the field, however, piping gas back to Woodside’s Pluto or NWS facilities could also be an option.

“At this point let me be perfectly clear the existing joint venture partnership has pursued FLNG as their primary development strategy,” said Woodside COO Mike Utsler.

“We think we can bring value to that discussion on the basis of our own experiences and if they then want to explore other options we think we have positioned NWS and Pluto to be serious considerations to ensure the optimum development of Scarborough.”

Woodside recently entered into Sale and Purchase Agreements to acquire half of BHP Billiton’s Scarborough area assets.

The Scarborough gas field is located approximately 220 km northwest of Exmouth, offshore Western Australia, and is one of the most remote gas resources in the 535,000 sq km Carnarvon Basin.

The acquisition includes a 25 per cent stake in WA-1-R, and 50 per cent WA-62-R, which together contain the Scarborough gas field.

Woodside will also acquire a 50 per cent interest in WA-61-R and WA-63-R which contain the Jupiter and Thebe gas fields. It means Woodside will operate WA-61-R, WA-62-R and WA-63-R, while ExxonMobil is the operator of WA-1-R.

Woodside will pay BHP Billiton AU$325 million (US$250 million) on completion of the transaction, and AU$195 million (US$150 million) contingent on a final investment decision to develop the Scarborough field.

While the effective date of the transaction is 1 July 2016, completion of the agreement is subject to pre-emption rights and regulatory approvals, which is targeted for the end of the year.

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