QatarEnergy and Woodside, the Australian energy giant, have signed a long-term contract to supply liquefied natural gas (LNG) from the LNG development project in Calcasieu Parish, Louisiana. This contract guarantees the supply of up to 3 million tons of LNG per year for a duration of 20 years and is considered a significant event for the financing of this project, which aims for initial production in 2029.
Contract and Project Details
The sales and purchase agreement (SPA) signed between QatarEnergy and Woodside pertains to the Louisiana LNG project, which is currently under construction near Lake Charles. This project includes three production units with a combined capacity of 16.5 million tons per year, aiming to produce the first LNG in 2029. Woodside will supply LNG from its share of the HoldCo volumes.
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Contract Implications for the LNG Market
Liz Westcott, CEO of Woodside, commented on the contract: "This historic agreement connects Woodside's competitive LNG project with QatarEnergy as a customer, one of the world's leading energy companies. This agreement is a strong vote of confidence in Louisiana LNG and represents an important step in building the project's long-term customer base."
Woodside will supply LNG on an FOB (free on board) basis starting from the commissioning of the Louisiana LNG Unit 2, with this amount increasing to 3 million tons per year upon the commissioning of Unit 3. The final investment decision (FID) will be made in April 2025. The project also has the capacity to expand with two additional LNG units, and the necessary permits for a total capacity of 27.6 million tons per year have been obtained.
The contract with Woodside was signed just days after a multi-year agreement with Cheniere for a total supply of 4 million tons of LNG until 2054. These agreements reflect QatarEnergy's strategy to expand the LNG market and strengthen its position in the global energy market.
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