Woodside and BP strike gas supply deal for freshly approved US LNG project

Australia’s energy giant Woodside has signed an agreement with UK-headquartered major BP for the latter to supply gas to feed into its recently sanctioned liquefied natural gas (LNG) project in Louisiana.

Under the agreement, Louisiana LNG Gas Management (GasCo), a wholly owned subsidiary of Louisiana LNG, is slated to purchase up to 640 billion cubic feet (bcf) of gas on a long-term basis from BP for an ultimate delivery to Line 200 starting in 2029. GasCo will be in charge of implementing the gas sourcing strategy to support the Louisiana LNG project.

According to Woodside, this agreement represents the first tranche of a diversified portfolio of feed gas for the recently approved project. The Australian player says this is enabled by the project’s “extensive” interconnectivity to multiple producing basins and interconnecting pipelines. 

Woodside’s CEO, Meg O’Neill, noted: “Louisiana LNG is a compelling investment, expected to deliver significant cash generation and create long term shareholder value. Securing this gas supply agreement is an important step for the project. Woodside has a long history of successful collaboration with bp.

“By drawing upon bp’s experience with MiQ certificates, we can access verifiably low methane intensity molecules for the Louisiana LNG project. This supports Woodside’s goals as a member in the UN Environment Programme’s OGMP 2.0 initiative.”

This comes a day after the Australian major announced that a final investment decision (FID) was taken for the three-train, 16.5 million tonne per annum (mtpa) Louisiana LNG project. The Australian firm describes this as the first greenfield U.S. LNG project sanctioned since the LNG export pause in the country was lifted.

Following the FID announcement, Woodside’s EVP & COO International, Daniel Kalms, and Louisiana LNG VP Vanessa Martin joined the Office of Governor Jeff Landry, Louisiana Economic Development Secretary Susan Bonnett Bourgeois, and Calcasieu Parish Administrator Dane Bolin to celebrate the milestone.

“As we advance Louisiana LNG, we look forward to delivering a world class LNG project and the economic benefits that flow from such investments. We also look forward to continuing our longstanding partnership with the state and building even stronger relationships and partnerships with the local communities around Lake Charles,” highlighted Woodside.

Meanwhile, BP is keeping busy with oil and gas developments, in line with its revamp strategy focusing on more investments in the oil and gas sector and limiting those related to energy transition.

Last week, the UK giant and its partners offshore Namibia struck oil on Block 2914. BP participates in the license as part of its joint venture with Eni, Azule Energy. The other co-venturers are Rhino Resources, NAMCOR, and Korres Investments.