CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79.75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open platformOpen platform

Australia's Woodside to supply QatarEnergy with Louisiana LNG in 20-year deal

By Reuters News

By Nichiket Sunil and Kumar Tanishk

Oct 29 (Reuters) - Australian oil and gas producer Woodside Energy WDS.AX will supply QatarEnergy with liquefied natural gas, the company said on Thursday, as the Middle East war disrupts operations at the Qatari firm, one of the world's largest LNG producers.

The 20-year deal gives QatarEnergy, which has been buying LNG from US exporters to supply customers, a source from outside the Gulf while shipping through the Strait of Hormuz is blocked. It also helps Woodside sell capacity at its Louisiana project, which has few committed buyers.

Reuters reported on the deal last week, citing three people with knowledge of the matter.

"What really strikes me is the length of the contracts. If you were just trying to fill a three- or four- year gap, you wouldn't be signing 20-year contracts," said Hersh Oberoi, global research director at Balfour Capital Group.

"Qatar is clearly treating the Hormuz risk as something that is not going away."

The Qatari company also informed some of its clients that they would not receive LNG until the end of this year, according to Italian utility Edison and market sources on Tuesday.

The commodity's prices have remained near multiyear highs, supported by ongoing concerns over the conflict and forecasts for colder weather. LNG/

Under the deal, Woodside will supply LNG on a free-on-board basis from the start-up of Louisiana LNG Train 2, increasing to 3 million tons per annum (mtpa) from the start-up of Train 3.

The project, which constitutes a $17.5 billion investment as of August, is a 16.5 mtpa export facility under construction and is targeting first LNG in 2029.

Woodside, Australia's top independent oil and gas producer, has been struggling to sell LNG volumes in Louisiana, as it sought liquefaction fees above US market rates, Reuters reported in May.

Before QatarEnergy, Woodside had only secured one long-term sales and purchase agreement for the project, a deal with Germany’s Uniper UN0k.DE.

Capital.com is an execution-only brokerage platform and the content provided on the Capital.com website is intended for informational purposes only and should not be regarded as an offer to sell or a solicitation of an offer to buy the products or securities to which it applies. No representation or warranty is given as to the accuracy or completeness of the information provided.

The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance.

To the extent permitted by law, in no event shall Capital.com (or any affiliate or employee) have any liability for any loss arising from the use of the information provided. Any person acting on the information does so entirely at their own risk.

Any information which could be construed as “investment research” has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.