In the run-up to Christmas, Woodside Energy (ASX: WDS; NYSE: WDS), announced that it and Chevron have agreed to an asset swap under which Woodside will acquire Chevron’s interest in the North West Shelf Project, the NWS Oil Project, and the Angel Carbon Capture and Storage Project. Woodside will transfer all of its interest in the Wheatstone and Julimar-Brunello Projects to Chevron; Chevron will also pony-up AUD$400m to Woodside in the form of $300m in cold-hard cash at completion (due in 2026) and a further $100m in contingent payments.
“The strategic and commercial rationale for this asset swap is compelling for Woodside,” said Woodside CEO Meg O’Neill. “This transaction simplifies our portfolio, improving our focus and efficiency by consolidating our position in our operated LNG assets. It is immediately cash flow accretive and includes a cash payment upon both execution and completion.
“Additionally, this improves joint venture planning for decarbonisation opportunities at Karratha Gas Plant. Our increased equity in the Angel CCS Project also supports future development of this large-scale, multi-user carbon capture and storage hub in Western Australia.”
The deal is subject to a variety of regulatory clearances including from the Australian Competition and Consumer Commission, from the Foreign Investment Review Board, and others.
Meanwhile, Woodside and the North West Shelf Joint Venture welcomed the Western Australian Government’s decision to provide environmental approval for the North West Shelf Project Extension.
“After six years of assessment and appeals, this is a critical step in the approvals process to underpin the ongoing operation of the North West Shelf Project so it can continue to deliver a reliable supply of energy locally and globally. The State’s decision recommences the Federal environmental approvals process, which was paused while appeals were being considered,” Woodside said in a statement.
Woodside Executive Vice President and Chief Operating Officer Australia Liz Westcott added that: “This year we are celebrating 40 years of domestic gas production from the Karratha Gas Plant and 35 years of LNG exports – a contribution to reliable energy supply which can continue for years to come. We look forward to the finalisation of the Federal approval process to provide certainty around the ongoing operation of the North West Shelf Project”.
Since commencing operations in 1984, the North West Shelf Project has supplied more than 6,000 petajoules of domestic gas, the company said, adding that if that amount of gas were solely for household use, it would provide enough power for every home in a city the size of Perth for approximately 175 years. Over the past four decades, the North West Shelf Project has paid more than $40 billion in royalties and excise, the company added.
