Woodside and Kansai Make Pluto LNG Deal

Woodside Energy and The Kansai Electric Power Co. have signed an agreement for the supply of between 1.75 and 2 million metric tons of liquefied natural gas (LNG) a year for 15 years from Woodside’s 100-percent-owned Pluto gas field in Western Australia.

The deal covers supply from the end of 2010, on an ex-ship basis, with an option to extend supply by five years. The heads of agreement provides for Kansai Electric to purchase a 5-percent equity interest in the Pluto development. Kansai president Shosuke Mori and Woodside CEO Don Voelte signed the agreement in Perth on Wednesday. The deal is the second agreement for Pluto volumes in the past four months.

. An LNG sales and purchase agreement is expected to be negotiated by the end of 2006. It will be conditional on a final investment decision by Woodside, which is due in the second quarter of 2007.

"As one of Japan’s major electricity suppliers, Kansai Electric is an ideal customer," said Voelte. "Woodside and Kansai Electric have enjoyed a long and beneficial relationship through the North West Shelf Venture and we look forward to furthering this relationship through Pluto."

Kansai is one of the largest electric power companies in Japan, with 2005 operating revenue exceeding US$22 billion. It has more than 35,000 megawatts of electricity generating capacity and more than 13 million residential, commercial, and industrial customers. The Pluto LNG development is based on the Pluto discovery, 190 kilometers northwest of Karratha in permit WA-350-P. The field was discovered in April 2005.