Woodside inks 20-year LNG supply deal with QatarEnergy

Australian LNG producer Woodside Energy (NYSE: WDS) has entered into a 20-year agreement with QatarEnergy to deliver as much as 3mn tonnes per year (tpy) of LNG from its Louisiana LNG project, the company announced on October 29.

The deal comes after reports emerged on October 23 that Woodside was discussing a potential deal with the Gulf state-run company.

The contract marks another significant commercial milestone for the project, which is currently being developed near Lake Charles, Louisiana. The facility's initial development phase comprises three processing units, with a combined production capacity of 16.5mn tpy.

Woodside is aiming to commence LNG production at the facility in 2029.

The company's Chief Executive Officer and Managing Director, Liz Westcott, said the latest arrangement reflected progress in implementing Woodside's broader business strategy.

Westcott highlighted the commercial importance of securing QatarEnergy, describing the deal as an endorsement of the Louisiana development and its future production potential.

She also noted that the latest contract complements an earlier supply arrangement with German energy company Uniper. Combined, the two agreements are expected to provide greater revenue visibility for a substantial share of the project's planned output.

Louisiana LNG will help Woodside diversify its international supply network and expand its capacity to serve energy markets worldwide.

Under the terms of the agreement, deliveries will be made on a free-on-board basis, commencing when the project's second liquefaction train becomes operational.

Supply volumes are scheduled to increase to the full commitment of 3mn tpy following the commissioning of Train 3.

The deal comes on the back of QatarEnergy securing 4mn tpy of LNG from Cheniere Energy (NYSE: LNG) on October 22.

Advanced negotiations were also held by QatarEnergy with Venture Global (NYSE: VG) for 3mn tpy, although no deal has been finalised yet.