Viva Energy signs MoU with Woodside for potential LNG supply

Viva Energy, operator of the Geelong refinery near Geelong in Victoria, and Woodside Petroleum Ltd., Perth, signed a memorandum of understanding (MoU) to engage in discussions that could lead to Woodside supplying LNG to Viva’s proposed regasification terminal at the Geelong site.

The agreement could result in Woodside gaining regasification rights for supply of gas to Australian east coast markets. The MoU provides a framework and timeline to negotiate binding regasification capacity commitments.

The agreement could underpin Viva’s plan for regasification at Geelong which includes a moored floating LNG reception terminal, extensions to the existing refinery jetty, and additional pipelines.

Viva’s CEO Scott Wyatt said that Woodside’s participation in the gas terminal project highlights the value of LNG terminals as ‘virtual pipelines’ to deliver LNG from Australia and other sources to the country’s east coast domestic market.

“This can be achieved more efficiently and with lower environmental impact than building new pipeline infrastructure to transport gas from other domestic sources,” he said.

In a parallel announcement Viva said it signed a heads of agreement (HoA) with global infrastructure and transport group Höegh LNG Ltd. to charter a floating storage and regasification unit for the proposed Geelong terminal.

The HoA sets out a framework and key terms for the negotiation of a binding time charter party agreement.

Viva is aiming to make a final investment decision to proceed with the Geelong project by third-quarter 2022.

Viva’s agreement is the second to involve Höegh in Australia’s race for construction of east coast LNG reception terminals.

In November, Australian Industrial Energy (AIE) signed a long-term charter party agreement for its proposed terminal at Port Kembla on the New South Wales coast south of Sydney (OGJ Online, Nov. 30, 2021).