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US$11B gas project receives nod to proceed to final investment decision

Woodside Energy workers
Woodside Energy workers

One of the nation’s largest energy producers and a mining giant are one step closer to bringing a US$11 billion (A$16.1B) gas development to life.

Woodside Energy and BHP have accepted a tolling price for their Scarborough Offshore Gas Project on the Burrup Peninsula, 405km north of Karratha in Western Australia.

The deal, which takes effect on 31 March 2020, is calculated based on BHP owning no more than a 25 per cent interest in the project up to the final investment decision. This means the proponents can make a final investment decision no later than 30 April 2020.

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3800 workers needed

The project will initially process gas on a deep-water floating production unit before transporting it through about 430km of pipeline to the Pluto Liquefied Natural Gas (LNG) Facility for further processing. First LNG is expected to be delivered in the year 2024.

About 3200 workers will be required during construction plus a further 600 once operational. None of the jobs are advertised yet.

“This agreement on tolling price, together with the increase in Scarborough gas resources announced earlier this month, provides a compelling and aligned basis for BHP and Woodside to finalise the required conditional binding agreements by the end of the first quarter of 2020,” Woodside CEO Peter Coleman said in a public statement.

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