Onshore option for Woodside Petroleum
Woodside Petroleum has given itself a better shot at processing gas onshore from yet-to-be developed fields off the North West through a staged 20 per cent expansion of the Pluto LNG plant.
The oil and gas producer is considering plugging in a smaller “off-the-shelf” second train at the Pilbara facility capable of adding about one million tonnes LNG a year to the first train’s 4.9 mtpa output.
Woodside chief executive Peter Coleman said the move would make a compelling case for onshore processing of the Browse and Scarborough gas fields, which both have floating LNG platforms as their preferred option.
“We want to knuckle down, put all this together and make the case that an onshore development should be a very competitive case that the joint venture partners in both those resources seriously consider,” he said.
Woodside holds stakes in both projects and is the operator of Browse, whose development was put on ice a year ago until the economics stack up.
“Our preference is to get the best commercial outcome,” Mr Coleman said of Browse and Scarborough.
Declining to put a price tag on the Pluto expansion, he said it would be similar to Gulf of Mexico coast plant upgrades and “comfortably” under $1000 per tonne of output.
“What I like about it is, we control it and it’s manageable,” Mr Coleman said.
“It suits the market at this point in time. We can get away a million tonnes pretty readily to our portfolio.”
Woodside reported last Wednesday full-year net profit of $US868 million ($1.13 billion), dwarfing last year’s oil price slump-affected $US26 million.
LNG production was a record 63.7 million barrels of oil equivalent.
Mr Coleman said the Chevronoperated Wheatstone project in which Woodside holds a 13 per cent stake would fail to meet a stretch target of completion this April but was on track for the scheduled mid-year start.
In the wake of outgoing Wesfarmers managing director Richard Goyder’s appointment to replace Michael Chaney as Woodside chairman next year, Mr Coleman said he planned to stick around. “I can see a line of sight right out to five years,” he said. “It’s just going to be subject to the board and what the board thinks the right needs are.”
Chief financial officer Lawrie Tremaine said his coming departure to join Origin Energy was about finding a new challenge after 10 years at Woodside.