Woodside goes it alone on Scarborough LNG
Luring investment into greenfield gas projects is tough, even in a gas-starved world
Not even a global gas shortage can convince investors to put their faith in newbuild liquefied natural gas projects, it seems. Australia’s Woodside Energy made big, risky concessions with private equity financiers to get its flagship Scarborough LNG project off the drawing board. Scarborough is a drop in the global LNG ocean, but the trouble faced by Woodside to get this far speaks volumes about the challenges of building greenfield plants today.
Woodside took a positive final investment decision (FID) on Monday at the Scarborough gas project offshore Western Australia and an expansion of the existing onshore Pluto facility. Gas from Scarborough will produce 8 million tonnes per annum (mtpa) of LNG from the expanded Pluto plant for export to Asian markets, with some gas sold to local WA domestic and industrial consumers. Scarborough and Pluto combined represent a $12 billion bet that Asian demand for gas…