Woodside Energy Group Ltd (ASX:WDS, LSE:WDS, OTC:WOPEF) has announced the sale of a 15.1% stake in the Scarborough LNG project, in Australia, to Japan's largest utility company in a deal worth US$1.4 billion.
The deal sees an upfront purchase price of around $740 million, plus reimbursement for back-costs dating back to 1 January 2022 (the ‘effective date’ of the transaction).
It is expected to complete in the second half of 2024, subject to regulatory and financing approvals.
Woodside noted that the joint venture group deepens arrangements between the firms around LNG cargo sales and new energy collaborations aimed at decarbonisation.
“Woodside welcomes Japan's largest utility, JERA, into the Scarborough joint venture,” Woodside chief executive Meg O’Neill said in a statement.
“This builds on a long history of collaboration, starting in 1989 with LNG sales from the North West Shelf to JERA's parent companies Tokyo Electric and Chubu Electric.”
"JERA's participation in the Scarborough Joint Venture, which will also include LNG Japan, is a further demonstration of the importance of the project to Japanese customers and confidence in long-term demand.”
O’Neill added: "Scarborough is a world-class project which will provide reliable energy for our customers in the Asian region, including in Japan. LNG continues to be an important energy source for Japan and one which supports the country's decarbonisation ambitions.”
Yukio Kani, JERA chief executive, added: “Solving the world's energy issues requires deep collaboration to tackle challenges one by one with reliable partners.”
“I look forward to further developing our relationship with Woodside, a global player in LNG, and to promote new initiatives to achieve decarbonisation."
Woodside retains a 74.9% interest in the project and will continue as operator.