North West Shelf Project Moves Towards Processing Third Party Gas

Woodside on Tuesday said North West Shelf (NWS) Project participants signed a non-binding Letter of Intent with Hess Exploration Australia Pty Ltd to process resources from Hess’ permits in the Carnarvon Basin.

“The Letter of Intent specifies the proposed terms, including tariff fees, to toll resources from WA-390-P, WA-474-P, and potentially other permits, through the NWS Project’s Karratha Gas Plant. It is intended that, subject to the parties entering into binding agreements, Hess will deliver gas to the NWS Project’s offshore infrastructure for processing at the Karratha Gas Plant and will market and deliver its own volumes,” Woodside announced.

NWS is a joint venture between BHP Billiton Petroleum (North West Shelf) Pty Ltd, BP Developments Australia Pty Ltd, Chevron Australia Pty Ltd, Japan Australia LNG (MIMI) Pty Ltd, Shell Australia Pty Ltd and Woodside Energy Ltd (Operator).

Woodside’s Senior Vice President NWS Niall Myles said that the Letter of Intent forms the basis for the negotiation of binding agreements in 2015.

“The Letter of Intent with Hess is an important step indicating the Karratha Gas Plant is ‘open for business’ – it provides an attractive option for third party gas owners to commercialise their resources in proximity to existing LNG infrastructure,” he said.

A tie-in and operational integration front-end engineering and design (FEED) studies agreement is expected to be executed for the project in early 2015.

Hess holds 100 percent interests in both the WA-390-P and WA-474-P permits that contain the Equus fields. These permits cover over 1 million acres and are located approximately 115 miles off the northwest coast of Australia in water depths of approximately 3,600 feet.