Regional LNG: Woodside expects LNG production from Pluto commences 2010

Australian E&P firm Woodsideis kicking goals with its aggressive push to more than double its equity share of liquefied natural gas exports through the rapid-fire A$5 billion development of its wholly owned Pluto gas field on the North-West Shelf as an initial 4 million tonne-a-year LNG producer, The Age reported Tursday.

The group told an investor seminar in Sydney Wednesday that negotiations for gas sale contracts were well advanced with North Asian customers for base load volumes from the project, with first production possible from the end of 2010 and with a potential build-up in exports to 7 million tonnes a year after US market customers were snared.

Because of its wholly owned status, Pluto is a game-changer for Woodside, whatever the group's 2006 exploration program comes up with. As operator and one-sixth partner in the existing North-West Shelf gas project, Woodside has an entitlement to 2.64 million tonnes of annual LNG production (after the $2 billion development of the project's fifth processing train from 2008).

Woodside used the recent downtime with the fourth LNG processing train to remove some bottlenecks, which should allow it to produce at a rate of 4.4 million tonnes a year, up from 4.2 million tonnes a year. The improvements will be incorporated into train five, lifting total NWS production capacity to 16.3 million tonnes a year, from 15.9 million.(*)

Woodside shares yesterday closed 27? weaker at $31.98.