Woodside, BP Make Big LNG Announcements

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--European energy security could get a lift from liquefied natural gas (LNG) volumes from the U.S., Uniper (Dusseldorf, Germany) said after signing an offtake agreement with Woodside Energy Group (NYSE:WDS) (Perth, Australia) for supplies from the planned Louisiana LNG export facility, while BP plc (NYSE:BP) (London, England) announced its debut of LNG cargo from Greater Tortue Ahmeyim.

Woodside renamed the facility after it completed its buyout of LNG developer Tellurian in October. It previously had been named Driftwood LNG.

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Tellurian in 2022 secured the permits necessary for the start of construction at the facility planned for Lake Charles, Louisiana. Phase I would be able to export as much as 1.5 billion cubic feet of liquefied natural gas per day (Bcf/d).

Woodside announced Thursday that it signed a sale and purchase agreement with Uniper for supplies from Louisiana LNG. From Louisiana, Uniper would receive about 130 million cubic feet of LNG per day.

"With this new project in Louisiana, we are further extending the cooperation with Woodside," said Michael Lewis, the chief executive officer of Uniper, in a press release. "Long-term LNG contracts like this contribute directly to the competitiveness of European industry."

Rich in natural gas, the U.S. delivered its first batch of LNG in 2016. It became the world leader in exports in 2022, helping to support energy security in Europe after former supplier Russia was sidelined because of sanctions related to its invasion of Ukraine.

Earlier in April, Woodside entered a binding agreement to sell a 40% stake in the Louisiana LNG export facility project to investment firm Stonepeak, which would invest $5.7 billion in a project that is now one step closer to a final investment decision (FID).

Under the transaction, Stonepeak will provide $5.7 billion toward the expected capital expenditure for an initial three trains, or liquefaction units. Woodside will remain the sole operator.

Operators need special licenses to ship LNG to countries without a U.S.-free trade agreement, and it is unclear how restrictive trade policies from Trump would impact existing or future arrangements.

Elsewhere, BP said it's helped establish Mauritania and Senegal as LNG exporters with the first cargo shipped from its Greater Tortue Ahmeyim (GTA) offshore facility. Kosmos Energy (NYSE:KOS) (Dallas, Texas), a partner with BP, said the first shipment was loaded onto the British Sponsor from an offshore storage vessel.

"A second LNG carrier is currently waiting near the hub terminal in preparation for the second cargo lifting," Kosmos said.

Gas from offshore started flowing to a floating production storage and offloading (FPSO) vessel in January.

After delays caused by the COVID-19 pandemic, drilling began in 2021. BP is the operator of GTA, with a 56% working interest, alongside Kosmos Energy (27%), PETROSEN (10%) and SMH (7%).

BP's trading arm, BP Gas Marketing, will be the sole buyer of LNG from the project, with exports likely bound for Europe.

LNG markets may be on the verge of a glut, however. The International Energy Agency is expecting supplies to outpace demand. In Europe, the IEA said demand could peak as early as this year.

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