It was the year of Indiana Jones and the Lost Crusade and the fall of the Berlin Wall.
1989 was also the year the North West Shelf (NWS) Project’s first LNG cargo left Dampier aboard the Northwest Sanderling for Tokyo Bay, Japan.
Though the world has changed massively these past 30 years, the relationship between the NWS Project and its Japanese customers has been characterised by a remarkable level of stability.
“The values of collaboration, trust and respect underpinned the long-term sales agreements signed by our companies more than three decades ago,” says Mark Abbotsford, vice president Marketing and Trading.
Chief operations officer Meg O’Neill agrees.
Speaking in Tokyo in May at an event to commemorate the 30-year milestone, Meg reflected that the relationship between the NWS Project and its customers in Japan had evolved into more than a series of commercial agreements.
“Our relationship has become a story of goodwill and friendship between Australia and Japan as a whole, and a great demonstration of how our two countries, their companies and their people can work together to promote mutual prosperity in our region,” Meg said.
“We can have great confidence that the relationships we have built – underpinned by the values of cooperation, trust and respect – will endure.”
Mark says the value of the relationships we have built with Japanese customers cannot be understated.
“Over the past 30 years, Woodside has transformed from a small but ambitious explorer to the largest Australian natural gas producer and a leading global supplier of LNG,” he notes.
“This never could have happened without the certainty provided by the long-term commitments of our foundation Japanese partners.”
The way the joint venture markets, trades and ships energy also has changed.
One difference is the transition from joint marketing to equity sales whereby new customers are supplied from Woodside’s portfolio of LNG supply sources, not jointly with the other five participants from the NWS Project.
“This transition reflects a maturity of both Woodside and the NWS Project and enables each of the NWS Project partners to be more responsive to both their own and their buyers’ needs,” Mark says.
One of the NWS Project’s key partners is JERA, the largest LNG buyer in the world.
Executive officer of JERA Hitoshi Nishizawa recounts the early days when the Project jointly marketed to a consortium of Japanese buyers — different to how the Project now deals with our Japanese customers on an individual basis.
“JERA and its parent shareholders, Tokyo Electric and Chubu Electric, were part of the original consortium of LNG customers of the Project,” he says.
Hitoshi says that over the past 30 years the NWS Project had demonstrated reliability, something greatly appreciated by customers such as JERA, adding: “In the future we look forward to our continuing partnership with Woodside.”
Though changes in the way business is conducted in global energy markets has opened the way for short-term decisions, Mark says the NWS and customers in Japan have taken a different track.
“We have consistently prioritised achieving sustainable, ‘win-win’ outcomes ahead of short-term advantage,” he points out, adding mutual commitment to the relationship has produced enduring value and stability for both sides.
Meg hopes the trading relationship between the project and its customers in Japan will only strengthen in the next stage of its development.
Read the full Q1 2019 issue of Trunkline here.