Australian operator Woodside Petroleum has completed the sell down of the expansion train under construction at its Pluto liquefied natural gas project in Western Australia.
Woodside confirmed on Tuesday it had completed the sell down of a 49% non-operating interest in Pluto Train 2 to Global Infrastructure Partners (GIP), following last year’s signing of a sale-and-purchase agreement with the US-based infrastructure investment fund.
Woodside in 2021 took the final investment decision on Pluto Train 2 as part of its wider Scarborough gas field development.
The project will include a new LNG train, with a capacity of about 5 million tonnes per annum, along with domestic gas facilities.
Woodside estimates capital expenditure for the Pluto Train 2 development at US$5.6 billion and the company noted on Tuesday that GIP will fund 49% of that cost, as well as provide roughly US$822 million in additional construction capital expenditure under the terms of the sale.
Banks draw criticism from green group
Confirmation of the sale followed criticism from environmental campaign group Market Forces earlier on Tuesday, which took aim at Australian banks that had helped fund GIP’s acquisition.
In particular it singled out National Australia Bank (NAB), Australia and New Zealand Banking Group (ANZ) and Westpac, stating it undermined their stated net-zero commitments by collectively lending GIP a combined A$3.5 billion (US$2.5 billion).
“The International Energy Agency has made it clear there is no room for new fossil-fuel supply projects if we are to achieve the goals of the Paris Climate Agreement,” Market Forces campaigner Jack Bertolus said.
“Yet, despite a clear commitment to net zero, NAB has just led a global banking consortium to enable a 1.6 billion-tonne carbon bomb, with ANZ and Westpac as part of the deal.”
Other international banks involved in the deal included Japan’s Mizuho, MUFG and SMBC, UK banks HSBC and Standard Chartered, and the Bank of China.
“The immensity of the fossil-fuel project is matched only by the banks’ willingness to repeatedly con their customers and their investors, who are all demanding action on the climate crisis,” Bertolus added.
“In reality, their money is being used to fund a project enabling emissions equivalent to running 15 coal plants for three decades.”
Market Forces noted that NAB had led the global banking consortium despite last November reaffirming its commitment for its business operations and lending portfolio to be net zero by 2050.
While Australian banks are moving away from coal-fired power projects, they have been more reluctant to stop financing gas developments, which they consider still have a key role to play in the energy transition.
NAB last year updated its oil and gas lending policy, stating it will continue to directly finance greenfield gas extraction in Australia, however, it will now cap oil and gas loans at US$2.4 billion.
It will also continue to support integrated LNG in Australia, New Zealand and Papua New Guinea, as well as selected LNG infrastructure in other regions, with the same cap.
While it remains committed to funding gas projects in the near term, NAB will start to reduce its exposure to the oil and gas sector from 2026 through to 2050.
Field development
Woodside last year sanctioned its US$12 billion Scarborough gas field development, which will underpin the Pluto Train 2 expansion.
The Scarborough field lies about 375 kilometres off the coast of Western Australia and is estimated to contain 11.1 trillion cubic feet of dry gas.
The development includes the installation of a floating production unit in a water depth of 950 metres, as well as an approximate 430-kilometre trunkline to transport the gas to the Pluto LNG facility.
The first development phase will see the drilling of eight subsea high-rate gas wells, with a total of 13 wells planned to be drilled over the life of the field.
