Australia's Woodside approves US$12 billion for Scarborough LNG project

Woodside Petroleum said on Monday it has given the final go-ah
ead to spend US$12 billion on Scarborough and Pluto Train 2, the key growth liquefied natural gas (LNG) project for Australia's biggest independent oil and gas company.

The company said gas processed through Pluto Train 2 will be one of the lowest carbon intensity sources of LNG delivered to customers in north Asia, and has targeted first cargo in 2026.

"The final investment decision is underpinned by quality customer support with approximately 60per cent of Scarborough capacity contracted, including domestic gas for the proposed Perdaman urea project, " Chief Executive Officer Meg O'Neill said in a statement.

The company had deferred the investment decision for the project in March last year, as it attempted to rein in capital spending to weather crashing oil prices amid the COVID-19 pandemic.

Woodside's share of investment in the project, which is co-owned by BHP Group, is US$6.9 billion.

Woodside and BHP on Monday signed an agreement, which will see Woodside merge with BHP's petroleum arm, as first announced in August.