Australian LNG player Woodside signed a deal with BHP under which the former will become the operator of the Scarborough field with a 75 percent interest.
According to Woodside’s statement, BHP waives its right of pre-emption and provides its consent to the sale by ExxonMobil to Woodside of its 50 percent interest in WA-1-R, and the Scarborough joint venture., resulting in Woodside’s interest rising to 75 percent.
Woodside will assume operatorship of the Scarborough once the transaction with ExxonMobil is complete.
In return for BHP waiving its pre-emption rights, Woodside will provide it with an option to buy additional 10 percent interest in Scarborough on equivalent consideration terms to the transaction with ExxonMobil.
The option may be exercised by BHP at any time prior to the earlier of 31 December 2019 and approval to commence the front-end engineering and design phase of the Scarborough development, the statement reads.
The two companies will further undertake discussions in relation to the utilization of WA-1-R which contains the majority of the Scarborough gas field and the adjacent WA-62-R license in which both Woodside and BHP hold 50 percent interest each.
Discussions will further be held in regards to the potential sale of up to 10 percent interest in Scarborough to the foundation LNG buyers as well as technical and commercial arrangements for the Scarborough development.
Speaking of the agreement, Woodside’s CEO, Peter Coleman said, “The Scarborough joint venture will now be focused on finalizing the development concept prior to entering FEED and positioning for FID in 2020.”
Completion of the transaction between ExxonMobil and Woodside continues to be targeted by end of the first quarter of 2018, Woodside said.
Woodside closes second phase of its A$2.5 bln equity raising
Woodside closed the retail component of its entitlement offer of new company shares representing the second stage of its A$2.5 billion ($1.97 billion) equity raising unveiled in February.
Closing on March 7, the entitlement offer brought in approximately A$578 million, the company’s statement shows.
Woodside added that it plans to offer for sale approximately 14.4 million entitlements not taken up under the entitlement offer in a shortfall bookbuild to be conducted on March 12, with closing expected on March 15.