Woodside Petroleum strikes LNG deal with Indonesia

Woodside Petroleum strikes LNG deal with Indonesia

Australian oil and gas producer Woodside Petroleum (ASX:WPL) has struck a multi-billion dollar deal with Indonesia’s Pertamina which will see the firm export large quantities of liquified natural gas (LNG).

The Perth-based company will sell around 600,000 tonnes of LNG to state-owned Pertamina from 2022 to 2034, with the option to increase that to 1.1 million tonnes a year from 2024.

The contract, which can also be extended out to 2038, represents the largest ever single trade deal between Australia and the neighbouring South East Asian nation.

While the commercial details of the deal remain confidential, assuming the most recent LNG export price of US$450 a tonne which Woodside commanded, the Pertamina deal could be worth a maximum of $495 million a year.

Woodside chief executive Peter Coleman said: “Our track record as a reliable supplier of LNG and the proximity of our key sources of LNG to Indonesia were key to achieving this deal.

“As more regional buyers enter the market, we are well placed to become the supplier of choice.”