Woodside Petroleum Ltd (ASX: WPL) gave the green light for its mammoth new gas project in Western Australia on Monday.
The ASX 200 energy company reported that final investment decisions had been made to approve the US$12 billion (AU$16.8 billion) Scarborough and Pluto Train 2 developments. Woodside’s share of the cost, which includes new domestic gas facilities and modifications to Pluto Train 1, comes to US$6.9 billion.
On Monday, Woodside CEO Meg O’Neill said: “Today’s decisions set Woodside on a transformative path. Scarborough will be a significant contributor to Woodside’s cash flows, the funding of future developments and new energy products, and shareholder returns.”
The final decision came despite a last-minute legal challenge from environmental groups.
With the project moving forward, traditional owners have reached out to Woodside to discuss acquiring a stake in the project.
Securing the future for local traditional owners
As Reuters reports, Western Australian Indigenous group, the Murujuga Aboriginal Corp (MAC), is in discussions with Woodside over attaining a stake in the Scarborough and Pluto LNG expansion “to help secure the future of the local traditional owners”.
Woodside’s Pluto LNG plant is on Murujuga country on the Burrup Peninsula.
However, according to Reuters:
MAC and other traditional owners do not receive royalties from businesses in the Burrup as rights to part of their land were acquired in 2002 to create an industrial development area, leaving MAC instead with the title to Murujuga National Park next to the industrial land.
Commenting on MAC’s proposal to secure a stake in the Woodside expansion project, MAC’s CEO Peter Jeffries said:
This is an integral element for development on [Murujuga] country as it helps us find ways to work together, to keep us involved, and to help create long-term sustainability and stability for our members and future generations. We want to be strategically vested in any project on country.
Woodside’s O’Neil told Reuters: “I’m not going to talk about any specific conversations that we’re having with any TO [traditional owner] group. Suffice it to say that we’ve got very active engagements…”
How has the Woodside share price been performing?
The Woodside share price has struggled in 2021, down 6%. By comparison the S&P/ASX 200 Index (ASX: XJO) is up 9% year-to-date.
Over the past month shares in the energy giant are down 11%. They closed Friday’s session down 5.1% on the day to $21.60 apiece.