Woodside will walk away from its 50 percent non-operated participating interest in the proposed Kitimat LNG (KLNG).
The 480 km Pacific Trail Pipeline route development is located in British Columbia, Canada.
But Woodside’s exit includes the divestment or wind-up and restoration of assets, leases and agreements covering the route and the site for a proposed LNG facility at Bish Cove.
The company will retain a position in the Liard Basin upstream gas resource.
Explaining the decision, Woodside acting CEO Meg O’Neill, said: “Following Chevron’s decision to exit KLNG and subsequent decision in March 2021 to cease funding further feasibility work, Woodside undertook a comprehensive review of our options for the project and our wider development portfolio.
“The Kitimat LNG proposal was designed to develop a new source of LNG to supply Asian markets in the latter part of this decade. However, we have decided to prioritise the allocation of capital to opportunities that will deliver nearer-term shareholder value.
“Woodside is focused on working towards the targeted final investment decision for the Scarborough LNG development in Western Australia in the second half of 2021 and the continued successful execution of our Sangomar oil project offshore Senegal.
“Retaining an upstream position in the prolific Liard Basin provides Woodside a low-cost option to investigate potential future natural gas, ammonia and hydrogen opportunities in British Columbia.”
The costs associated with the decision to exit KLNG are expected to impact 2021 net profit after tax (NPAT) by approximately $40 – 60 million. These costs will be excluded from underlying NPAT for the purposes of calculating the dividend.
For more information visit www.woodside.com.au
