Woodside Energy Group Ltd (ASX: WDS) shares are pushing higher on Monday.
In afternoon trade, the energy giant's shares are up over 1% to $24.90.
Why are Woodside shares rising?
As well as benefitting from a positive session for the energy sector today, Woodside shares are lifting off thanks to the release of some positive news this morning.
According to the release, Woodside and Keppel have signed a conditional offtake term sheet for the supply and purchase of liquid hydrogen aimed at powering the latter's data centres in Singapore.
Keppel is a global asset manager and operator with strong expertise in sustainability-related solutions. Headquartered in Singapore, it operates in more than 20 countries worldwide, providing critical infrastructure and services for renewables, clean energy, decarbonisation, sustainable urban renewal, and digital connectivity.
This includes a large network of wholesale and colocation data centres across Asia-Pacific and Europe.
The release reveals that the term sheet came about following a non-binding heads of agreement between the two parties in April 2023. Today's conditional agreement tables commercial principles that may pave the way for an eventual binding offtake agreement for the supply of liquid hydrogen from as early as 2030.
The sources of liquid hydrogen would include Woodside's proposed production facilities, including H2Perth.
The release notes that Keppel intends for the potential liquid hydrogen supply to form part of a larger, long-term utility-scale lower carbon power portfolio that it is building to power its assets.
Commenting on the news, Woodside's CEO, Meg O'Neill, said:
We're pleased to be working with Keppel on the potential for supply of lower carbon energy in the form of hydrogen to its data centres in Singapore. This opportunity builds on Woodside's track record of being a safe and reliable supplier of energy to Asia for 35 years.
Keppel's Data Centres CEO, Wong Wai Meng, adds:
As a leader in data centres, Keppel is pleased to deepen our collaboration with Woodside through the signing of an Offtake Term Sheet, which has the ability to provide a reliable and stable source of lower carbon energy to power our assets in Singapore.
As the energy transition unfolds, Keppel will continue to innovate and seek out likeminded partners to enhance and future proof our data centres as we position ourselves to better serve our customers on their journeys to net zero.
Despite today's gain, Woodside shares remain down almost 30% over the past 12 months.
