Partners in the Australian North West Shelf Venture's liquefied natural gas project signed letters of intent for the sale of 1 million tonnes/year of LNG to Tokyo Gas Co. Ltd. and Toho Gas Co. Ltd., Woodside Energy Ltd. announced Friday. The agreements provide significant encouragement to expand the joint venture�s Karratha-based production facilities in Western Australia by about 50%, said John Akehurst, the managing director of Woodside Energy, operator of the venture.
More letters of intent with several other Japanese customers are expected in the coming months, Akehurst said, after which the venture will decide whether to build a new LNG production train with capacity of up to 4.2 million tonnes/year.
Another deciding factor relating to the proposed expansion, Akehurst said, was the Aug. 23 decision on Australian greenhouse policy that pledged Australian industry would not be harmed.
Deliveries of LNG under the Tokyo-Toho accord will start in mid-2004 and build to the 1 million tonne plateau by 2006. The parties will now move on to finalize sales and purchase agreements by the end of 2000.
In 1999, the North West Shelf Venture celebrated its 10th year of LNG shipments to Japan and the supply of 1,000 cargoes with a 100% delivery record, said Woodside.
Tokyo Gas is the largest gas utility in Japan, accounting for about 40% of total Japanese gas sales. Toho Gas is the third largest Japanese gas utility.
The five other equal participants in the Australian LNG joint venture are: BHP Petroleum (North West Shelf) Pty. Ltd.; BP Developments Australia Pty. Ltd.; Chevron Australia Pty. Ltd.; Japan Australia LNG (MIMI) Pty. Ltd.; and Shell Development (Australia) Pty. Ltd.