Australia’s Woodside Energy signs a 20-year LNG deal with Mexico Pacific. Woodside Energy (WDS.AX) said on Wednesday that it has signed a contract with Mexico Pacific, an energy firm, to acquire 1.3 million metric tons of liquefied natural gas (LNG) annually for a period of twenty years. The goal of this agreement is to increase output and improve operational efficiency.
As part of the agreement, the Australian oil and gas company will purchase the LNG from Mexico Pacific’s Saguaro Energia LNG plant, which is situated in Sonora, Mexico. The purchase will take place on a free-on-board basis, and the price will be tied to the gas indices in the United States.
“This agreement with Mexico Pacific delivers a new source of LNG into our trading portfolio, expands our geographic diversification in the Pacific Basin, and builds on our presence in Mexico,” said Meg O’Neill, the chief executive.
She went on to say that the transaction will also assist Woodside in gaining proximity to important markets in Asia.
On the condition that Mexico Pacific makes a final investment decision (FID) for a projected third train at the project, which is anticipated to take place in the first half of 2024, the agreement will be considered unconditional.
It is anticipated that commercial activities will begin at the facility in 2029, according to Woodside.
By 23:19 GMT, the shares of the country’s leading independent oil and gas producer had increased by 0.2% to A$29.60. This was in contrast to the 0.3% increase in the benchmark (AXJO) investment index.
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