Woodside Energy Group has agreed to sell an additional 15.1% stake in the Scarborough joint venture (JV) in Australia to Japan-based JERA for a price of around $1.4bn.
The consideration comprises a purchase price of close to $740m, along with reimbursement to Woodside Energy for JERA`s portion of expenses accrued from the transaction`s effective date of 1 January 2022.
The Scarborough JV is part of the Scarborough Energy Project which also includes the Pluto Train 2 JV and alterations to Pluto Train 1 for processing gas from the Scarborough field.
The first LNG cargo from the Scarborough Energy Project is expected to be achieved in 2026.
Situated in the Carnarvon Basin, nearly 375km off the northwest coast of Western Australia, the Scarborough field along with its related offshore and subsea infrastructure make up the Scarborough JV.
Upon closing of the deal, Woodside will have a reduced operating stake of 74.9% in the JV. JERA forays into the JV with the 15.1% stake, joining another Japanese firm LNG JAPAN, which took a 10% stake last year for $500m.
The transaction, which is subject to securing permits and approvals among other conditions, is anticipated to close in the latter half of this year.
JERA global CEO and chair Yukio Kani 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 promoting new initiatives to achieve decarbonisation.”
Additionally, JERA and Woodside Energy have come to terms on LNG procurement and cooperation regarding ventures in emerging energy and environmentally friendly services.
The parties have inked a non-binding agreement for the acquisition and sale of six LNG shipments annually, delivered ex-ship, spanning a decade starting in 2026, sourced from Woodside Energy`s worldwide assortment.
For collaboration in new energy initiatives, a non-binding agreement has been signed as well. This encompasses potential ventures in ammonia, hydrogen, carbon management tech, and carbon capture and storage to bolster mutual decarbonisation objectives.
The transaction additionally grants JERA an option to acquire a 15.1% non-operating participating interest in the Thebe and Jupiter fields.
Furthermore, a non-binding agreement outlines a long-term collaboration aimed at pursuing opportunities for additional feed gas and joint investment in offshore gas fields, potentially facilitating tieback to the Pluto LNG facility via Scarborough infrastructure.
O’Neill said: “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.”
