Woodside Sells 10% Interest in Scarborough Joint Venture to LNG Japan
LJ Scarborough (LNG Japan) received a 10% non-operating participating interest in Woodside’s Scarborough Joint Venture and may obtain potential LNG offtake and energy collaborations as part of a previous agreement.
Woodside Energy announced the sale of a 10% non-operating participating interest in the Scarborough Joint Venture—a natural gas field development project—to LNG Japan.
“LNG Japan’s commitment to the Scarborough Joint Venture is a demonstration of the value our customers place on gas as a long-term source of energy as they navigate the energy transition. Completion of the sale to LNG Japan is a significant milestone as we progress toward first LNG cargo from Scarborough targeted in 2026,” said Meg O’Neill, Woodside CEO. “We are also pleased to welcome Japan Organization for Metals and Energy Security’s equity investment in LJ Scarborough Pty Ltd. JOGMEC’s support reflects the contribution Scarborough gas will make to Japan’s energy security.”
Woodside previously established a strategic partnership with LNG Japan on Aug. 8, 2023 that granted LNG Japan equity in the Scarborough Joint Venture, potential LNG offtake from the site, and collaboration on new energy opportunities. Woodside received US$910 million for LNG Japan’s equity in the project, which covered the purchase price, reimbursed expenditure, and escalation.
Woodside will remain the sole operator of the Scarborough Joint Venture with a 90% majority interest in the project. Once the company completes the 15.1% interest transaction with JERA announced on Feb. 23, 2024, its interest will fall to 74.9%. After the most recent sale, Woodside’s share of proven undeveloped reserves in the Scarborough field will be reduced to 1,158.3 million barrels of oil equivalent (MMboe), while proven plus probable undeveloped reserves decrease to 1,809.7 MMboe. Woodside’s best estimate contingent resources fall to 20.2 MMboe.
Scarborough's Pluto Train 2; Image Credits: Woodside Energy
The Scarborough field is located nearly 375 km off the coast of Western Australia with low amounts of CO2 in its reservoir—less than 0.1%. Gas from the field will be processed at the Pluto LNG facility operated by Woodside. The company is currently building Pluto Train 2 at the facility.
In 2021, Woodside entered a partnership with MAN Energy Solutions to commercialize a small-to-mid scale LNG production solution known as Factory LNG. The process involves a 0.05 mtpa unit that can be transported with heavy-lift shipping and trucking logistics, as well as MAN Energy’s high-speed, oil-free, integrated motor compressor technology. Factory LNG enables a decade of low-to-no touch maintenance and encourages flexible layout options to adhere to site constraints.
“Factory LNG’s design paves the way for reduced manufacturing costs and shorter construction timeframes compared to traditional stick-built or modular LNG trains,” said Basil Zweifel, Senior Vice President Sales & Project Management Upstream & Midstream at MAN Energy Solutions.
In addition to a majority ownership in the Scarborough Joint Venture and a collaboration with MAN Energy, Woodside also retains a 23.9% interest in bp’s Argos offshore platform. Argos is located 190 miles south of New Orleans in approximately 4,500 feet of water and has a gross production capacity of up to 140,000 barrels of oil per day.
