REG - Woodside Energy Grp. - WDS to sell 15.1% Scarborough interest to JERA

Woodside EnergyAnnouncement

23/02/2024 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240223:nRSW2036Ea&default-theme=true

RNS Number : 2036E  Woodside Energy Group Ltd  23 February 2024

Woodside Energy Group Ltd

ACN 004 898 962

Mia Yellagonga

11 Mount Street

Perth WA 6000

Australia

T +61 8 9348 4000

www.woodside.com

 

ASX: WDS

NYSE: WDS

LSE: WDS

 

Announcement

 

Friday, 23 February 2024

 

 

WOODSIDE TO SELL 15.1% SCARBOROUGH INTEREST TO JERA

 

Woodside has broadened its strategic relationship with JERA through a
transaction that involves three core elements: equity in the Scarborough Joint
Venture; LNG offtake; and collaboration on opportunities in new energy and
lower carbon services. 1  (#_ftn1)

 

Woodside has executed a binding sale and purchase agreement with JERA for the
sale of a 15.1% non-operating participating interest in the Scarborough Joint
Venture (JV) for an estimated total consideration of US$1,400 million. 2 
(#_ftn2) This comprises the purchase price of approximately $740 million, and
reimbursement to Woodside for JERA's share of expenditure incurred from the
transaction effective date of 1 January 2022. Completion of the transaction is
expected in the second half of 2024.

 

Woodside and JERA have also entered into a non-binding heads of agreement for
the sale and purchase of six LNG cargoes on a delivered ex-ship basis per year
for 10 years commencing in 2026 from Woodside's global portfolio.

 

A non-binding agreement for new energy collaboration including potential
opportunities in ammonia, hydrogen, carbon management technology and carbon
capture and storage was also signed to support common decarbonisation
ambitions.

 

Woodside CEO Meg O'Neill welcomed the broadened strategic relationship with
JERA.

 

"Woodside welcomes Japan's largest utility, JERA, into the Scarborough Joint
Venture. This builds on a long history of collaboration, starting in 1989 with
LNG sales from the North West Shelf to JERA's parent companies Tokyo Electric
and Chubu Electric.

 

"JERA's participation in the Scarborough Joint Venture, which will also
include LNG Japan, is a further demonstration of the importance of the project
to Japanese customers and confidence in long-term demand.

 

"Scarborough is a world-class project which will provide reliable energy for
our customers in the Asian region, including in Japan. LNG continues to be an
important energy source for Japan and one which supports the country's
decarbonisation ambitions.

 

"In Australia, the Scarborough Energy Project will provide local jobs and
contracting opportunities and deliver tax revenue to State and Federal
Governments.

 

"We are also looking forward to exploring new energy and business
opportunities alongside JERA. These have the potential to further our shared
ambitions to develop new energy value chains between Australia and Japan," she
said.

 

Yukio Kani, JERA Global CEO and Chair said, "Solving the world's energy issues
requires deep collaboration to tackle challenges one by one with reliable
partners. I am grateful for the open and engaging dialogue I have had with
Woodside CEO Meg O'Neill. I look forward to further developing our
relationship with Woodside, a global player in LNG, and to promote new
initiatives to achieve decarbonisation."

 

Completion of the Scarborough equity transaction is subject to conditions
precedent including Foreign Investment Review Board approval, National
Offshore Petroleum Titles Administrator approvals, Western Australian
Government approvals and satisfaction of requisite financing approvals.

 

The transaction also includes an option for JERA to acquire a 15.1%
non-operating participating interest in the Thebe and Jupiter fields as well
as a non-binding agreement that outlines a long-term collaboration to pursue
opportunities for additional feed gas and joint investment in offshore gas
fields for future tieback to the Pluto LNG facility via Scarborough
infrastructure. A non-binding agreement has also been signed for Woodside to
provide carbon management services to assist JERA to meet its obligations
associated with its share of carbon emissions from the Scarborough Joint
Venture.

 

Following completion of the sale of equity to JERA, Woodside will hold a 74.9%
interest in the Scarborough Joint Venture and remain as operator. 3  (#_ftn3)

 

About Scarborough

The Scarborough Energy Project comprises the Scarborough Joint Venture, the
Pluto Train 2 Joint Venture and modifications to Pluto Train 1 to process
Scarborough gas. The Scarborough Joint Venture includes the Scarborough field
and associated offshore and subsea infrastructure.

 

The Scarborough field is located approximately 375 km off the coast of Western
Australia and the reservoir contains less than 0.1% carbon dioxide.
Scarborough gas will be processed at the Pluto LNG facility, where Woodside is
currently constructing Pluto Train 2. Woodside is operator of Pluto LNG and
Pluto Train 2.

 

In August 2023, Woodside entered into a sale and purchase agreement with LNG
Japan for the sale of a 10% non-operating participating interest in the
Scarborough Joint Venture.(3)

 

About JERA

Established in 2015, JERA is an equal joint venture of two major Japanese
electric power companies, TEPCO Fuel & Power Incorporated and Chubu
Electric Power Company and produces about 30% of all electricity in Japan.
JERA is an energy company with global reach that has strength in the entire
energy supply chain, from participation in LNG upstream projects and fuel
procurement, through fuel transportation to power generation. JERA, which
stands for Japan's Energy for a New Era, will take on the challenge of
achieving net zero CO(2) emissions from its domestic and overseas businesses
by 2050 and is supporting an energy transition in an environmentally and
socially responsible manner. For more details: https://www.jera.co.jp/english
(https://aus01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.jera.co.jp%2Fenglish&data=05%7C02%7CSARAH.PEYMAN%40woodside.com%7Cfb0348c9733b4dac7ad108dc31dd7d3b%7Ca3299bbaade64965b011bada8d1d9558%7C0%7C0%7C638440074562277776%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C0%7C%7C%7C&sdata=8iBW7o4M3HTYVmLeI3XmoMmeQEujutkhof88EHC5RH8%3D&reserved=0)

 

 Contacts:

 INVESTORS                  MEDIA

 Marcela Louzada            Christine Forster

 M: +61 456 994 243         M: +61 484 112 469

 E: investor@woodside.com   E: christine.forster@woodside.com

 

This announcement was approved and authorised for release by Woodside's
Disclosure Committee

Forward-looking statements

 

This announcement contains forward-looking statements with respect to
Woodside's business and operations, market conditions, results of operations
and financial condition, including, for example, but not limited to,
statements regarding the transaction (including statements concerning the
timing and completion of the transaction, the expected benefits of the
transaction and other future arrangements between Woodside and JERA), the
timing of completion of other transactions, the timing of completion of
Woodside's projects and expectations regarding future expenditures and future
results of projects. All forward-looking statements contained in this
announcement reflect Woodside's views held as at the date of this
announcement. All statements, other than statements of historical or present
facts, are forward-looking statements and generally may be identified by the
use of forward-looking words such as 'guidance', 'foresee', 'likely',
'potential', 'anticipate', 'believe', 'aim', 'estimate', 'expect', 'intend',
'may', 'target', 'plan', 'forecast', 'project', 'schedule', 'will', 'should',
'seek' and other similar words or expressions.

Forward-looking statements in this announcement are not guidance, forecasts,
guarantees or predictions of future events or performance, but are in the
nature of aspirational targets that Woodside has set for itself and its
management of the business. Those statements and any assumptions on which they
are based are only opinions, are subject to change without notice and are
subject to inherent known and unknown risks, uncertainties, assumptions and
other factors, many of which are beyond the control of Woodside, its related
bodies corporate and their respective officers, directors, employees, advisers
or representatives.

Details of the key risks relating to Woodside and its business can be found in
the "Risk" section of Woodside's most recent Annual Report released to the
Australian Securities Exchange and the London Stock Exchange and in Woodside's
most recent Annual Report on Form 20-F filed with the United States Securities
and Exchange Commission and available on the Woodside website at
https://www.woodside.com/investors/reports-investor-briefings. You should
review and have regard to these risks when considering the information
contained in this announcement.

Investors are strongly cautioned not to place undue reliance on any
forward-looking statements. Actual results or performance may vary materially
from those expressed in, or implied by, any forward-looking statements.

All information included in this announcement, including any forward-looking
statements, speak only as of the date of this announcement and, except as
required by law or regulation, Woodside does not undertake to update or revise
any information or forward-looking statements contained in this announcement,
whether as a result of new information, future events, or otherwise.

 

Announcement contains inside information

 

This announcement contains inside information. Marcela Louzada, Vice President
Investor Relations is responsible for release of this announcement.

 1  (#_ftnref1) Woodside uses the term 'lower carbon services' to describe
technologies such as carbon capture, utilisation and storage (CCUS) or offsets
that could be used by customers to reduce their net greenhouse gas emissions.

 2  (#_ftnref2) The sale and purchase agreement is with JERA Scarborough Pty
Ltd which is a wholly owned subsidiary of JERA Co., Inc.

 3  (#_ftnref3) Woodside's equity of 74.9% in the Scarborough JV is subject to
completion of the transaction with LNG Japan announced on 8 August 2023,
expected in the first quarter of 2024 as well as completion of the transaction
with JERA expected in the second half of 2024.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  AGRGBGDDGGDDGSX