Page 5 - GLNG Week 50 2021

GLNG COMMENTARY GLNG

Woodside is expanding
its nascent hydrogen
business.

green light to expand the Pluto LNG terminal, H2TAS – that would produce ammonia from
which will be fed by Scarborough. In this week’s hydrogen for export.
announcement, O’Neill described the develop- These projects are designed to be phased, the
ment of Scarborough and the Pluto expansion company said, starting small but with the poten-
as a game-changer for Woodside. tial to be scaled up if demand allows it.
The company’s operations in Myanmar were Meanwhile, Woodside is also working with
missing from its outline of the merged entity’s BP, Mitsui & Co. and Mitsubishi to study the
portfolio of assets, meanwhile. O’Neill said all feasibility of CCS at a depleted gas field offshore
of Woodside’s business decisions in Myanmar Western Australia.
were under review following a military coup in
the country in February. What next?
Woodside’s entry barriers for new energy devel- Woodside’s
Cleaning up opments are lower than those for new oil and gas
At the same time, though, Woodside is trying projects. The company is targeting an internal entry barriers
to step up its investments in cleaner energy. In rate of return (IRR) of more than 10% and pay- for new energy
particular, the company believes that investing back within 10 years from new energy projects.
in hydrogen projects and carbon capture and At the same time, it is targeting an IRR of more developments are
storage (CCS) is the best way to leverage its oil than 12% and payback within seven years from
and gas expertise and maintain returns to share- new gas projects, and an IRR of above 15% with lower than those
holders as the energy transition picks up pace. payback within five years for oil developments.
The US project it announced this week The gas projects it is targeting include both for new oil and
involves the production of green hydrogen – pipelines and new LNG developments, with the gas projects.
which uses electrolysis and renewable energy – company saying it would leverage existing infra-
from a site in Oklahoma. Woodside has entered structure to monetise undeveloped gas. This
into a memorandum of understanding (MoU) includes optionality for hydrogen, according to
with Hyzon Motors to develop the project, this week’s presentation.
which is known as H2OK. As well as securing a The $5bn investment target for new energy
lease and option to purchase land in Oklahoma would need to be revisited, however, if the
to underpin the project, Woodside said it was merger with BHP’s oil and gas business falls
“progressing similar land acquisition opportu- through.
nities aligned to growth markets in the US”. “But again, we have full confidence that our
As well as H2OK, Woodside is also devel- shareholders will support the merger,” O’Neill
oping two projects in Australia – H2Perth and told analysts during this week’s presentation.™

Week 50 17•December•2021 www. NEWSBASE .com P5