Viva Energy (ASX:VEA) awards Woodside Petroleum (ASX:WPL) the go ahead to supply the east coast with LNG from Western Australia via a memorandum of understanding (MoU).
The MoU would see Woodside ship LNG from WA to Viva Energy’s planned import terminal in Victoria’s Geelong.
Viva is planning to take a final investment decision on the Geelong project by the third quarter of next year, putting it on track to help ease a gas supply shortfall forecast to hit east coast markets from the mid-2020s.
Woodside chief executive officer Meg O’Neill welcomed the collaboration with Viva Energy on potential LNG supply from Woodside’s portfolio to the east coast market, which would be a milestone for the Australian gas industry.
“Our MOU with Viva Energy presents an opportunity for Woodside to supply reliable, cost-competitive LNG from our Western Australian projects and global portfolio into the east coast gas market, which is predicted to face a shortfall in coming years”.
Viva Energy chief executive officer Scott Wyatt said “we are very pleased to be progressing this opportunity with Woodside, a leading LNG producer. Woodside’s experience and capability in LNG supply, shipping, terminals and international gas markets will assist us in progressing the Gas Terminal Project to a final investment decision”.
Shares in Viva Energy (ASX:VEA) is trading 0.5 per cent lower at $2.13 while shares in Woodside Petroleum (ASX:WPL) is trading 0.2 per cent lower at $22.36.