Woodside gives formal nod to Pluto LNG project
Woodside Petroleum has agreed to spend $11.2 billion (Aus.) to develop an LNG project using gas from its wholly owned Pluto and Xena fields in Western Australia's Carnarvon basin.
MELBOURNE, Aug. 6 -- Perth-based Woodside Petroleum Ltd. has agreed to spend $11.2 billion (Aus.) to develop an LNG project using gas from its wholly owned Pluto and Xena fields in Western Australia's Carnarvon basin, 190 km off Karratha.
The timetable calls for first gas to be delivered by yearend 2010.
The initial phase will involve a single LNG production train having a 4.3 million tonne/year capacity on the Burrup Peninsula and a 180 km, 36-in. subsea pipeline from the fields.
A field platform at Pluto, moored in 85 m of water, will be connected to five subsea wells. A second phase, which will require additional funding approval, will include compression on the platform and a tie-in to the smaller Xena field. Onshore facilities will also include storage tanks and a marine loading terminal.
The company said that reservoir studies indicate the combined dry gas content for Pluto and Xena has increased to 5 tcf from 4.5 tcf.
Woodside has spent about $800 million (Aus.) on preliminary studies at the field and preparatory work at the LNG site. The additional funding just approved is higher than Woodside's earlier estimates of $6-10 billion.
Funding will be provided by cash flow from the company's Australian operations along with a fully underwritten dividend reinvestment plan and the issuance of corporate debt.
The company had already preapproved $1.4 billion for long-lead items and LNG plant site preparation. Earthworks began in January.
Woodside received provisional environmental approval in June despite its earlier having failed marine standards set by the Western Australian Environment Protection Authority. The EPA said the project could proceed if Woodside agreed to a range of conditions for the pipeline access route.
Sales contracts have been signed with Japanese companies Kansai Electric and Tokyo Gas.