Woodside’s $16.4 cardinal Scarborough LNG task could beryllium a dud concern if the satellite commits to net-zero emissions by 2050, according to projections successful the International Energy Agency’s World Energy Outlook released connected Wednesday.
The LNG giant’s docket to authorisation Scarborough precocious this twelvemonth puts the company-defining determination conscionable aft November’s COP 26 league successful Glasgow, wherever satellite leaders are expected to perpetrate to further greenhouse state emissions reductions.
The IEA issued its influential yearly study earlier than accustomed to spell retired what was astatine involvement earlier delegates arrived successful Glasgow.
The autarkic bureau outlined a “narrow but achievable” way to limiting planetary warming to 1.5 degrees.
The net-zero emissions by 2050 script archetypal published successful May required nary caller state fields to beryllium developed beyond those already approved.
Further details published by the IEA connected Wednesday bespeak sending Scarborough state to an expanded Pluto LNG works record whitethorn beryllium detrimental to the finances of Woodside shareholders, arsenic good arsenic the climate.
In the net-zero script the planetary LNG trade, which Australia had a $32 cardinal stock of past fiscal year, peaks mid this decennary and past goes into decline. By 2030 the capableness of existing LNG plants and those nether operation volition beryllium treble the demand, according to the IEA.
Under the Paris-based agency’s net-zero scenario, state prices volition autumn with request and “any LNG projects with a break-even terms of much than $US5 per cardinal British thermal units (MBtu) would beryllium astatine hazard of failing to recoup their concern costs”.
This is an unattractive script for Woodside, that touted Scarborough arsenic having a “globally competitory outgo of supply” of $US6.8 an MBtu successful a presumption to investors successful August.
Woodside calculated the outgo of supplying LNG from Scarborough utilizing a 10 per cent complaint of instrumentality but claimed the task would execute a instrumentality of much than 12 per cent, indicating it is assuming an LNG terms somewhat greater than $US6.8 an MBtu.
If the IEA and Woodside are close successful their respective assessments of the planetary state marketplace and the Scarborough project, past Woodside’s imaginativeness that it “prospers successful a low-carbon world” appears retired of reach.
Woodside’s LNG terms forecast is realised for its targeted Asian markets successful 2 IEA scenarios, wherever the satellite warms by 2.6 degrees nether existent clime policies oregon by 2.1 degrees, if announced policies are besides enacted.
The IEA warned the quality successful the scenarios had “stark consequences for planetary ecosystems and quality wellbeing”.
“The higher the somesthesia rise, the greater the risks of terrible upwind events specified arsenic utmost heat, drought, stream and coastal flooding and harvest failures,” the study said.
Woodside’s website states it supports the Paris Agreement’s goals to “limit the emergence successful planetary somesthesia to good beneath 2 degrees from pre-industrial levels and to prosecute efforts to bounds it to 1.5 degrees”.
Many investors driven by ethical concerns and a privation to minimise hazard present question investments that volition execute successful a decarbonising economy.
Any cognition that Scarborough is lone suited to a satellite wherever efforts to bounds planetary warming neglect is different hurdle for the institution to jump, to execute its purpose of extending the beingness of its 2 LNG plants adjacent Karratha.
A Woodside spokeswoman said the institution would remark erstwhile it completed its reappraisal of the IEA report.
Most Viewed successful Business