Woodside Burrup Pty Ltd and its Pluto LNG joint venture participants (Kansai Electric Power Australia Pty Ltd and Tokyo Gas Pluto Pty Ltd) have delivered their first cargo of carbon offset condensate to commodity trading company Trafigura Pte Ltd.
On Monday, Woodside outlined that the carbon dioxide equivalent emissions associated with extraction, storage and shipping of the 650,000- barrel cargo will be offset through a combination of efficiency measures, which reduce emissions, and surrender of high-quality carbon offsets. Trafigura is also working with the vessel owner to minimise actual emissions associated with transporting the cargo.
High-quality carbon offsets have been sourced from nature-based projects located in the Asia-Pacific region, independently validated and verified by the Gold Standard or Verified Carbon Standard. Carbon dioxide equivalent emissions generated by extraction, storage and shipping of the cargo will be calculated jointly by Woodside and Trafigura.
Calculation of emissions associated with extraction and storage will be based on data gathered by Woodside, as operator of Pluto LNG in Western Australia. Calculation of carbon emissions associated with shipping will be based on data collated by Trafigura, specific to the cargo voyage.
Woodside Vice President Marketing Trading & Shipping, Mark Abbotsford, said it could be the first carbon offset condensate cargo traded globally, demonstrating opportunities for carbon offset condensate.
“The transaction brought all the participants in the joint venture responsible for producing the condensate together with the customer, a global trading company, in support of our recently announced emissions reduction targets,” Mr Abbotsford said.
“The transaction provided an opportunity to further develop our carbon offset marketing capability and gain an understanding of the carbon market in its early phases.”
In addition to the transaction, Woodside and Trafigura have signed a non-binding memorandum of understanding (MOU) to explore opportunities for carbon management in the marketing of carbon offset condensate, crude oil and liquefied petroleum gas in the future.
“The MOU is consistent with Woodside’s and Trafigura’s respective objectives to explore a market for carbon offset products over the long term and reduce emissions intensity across the value chain,” Mr Abbotsford said.
Dmitri Croitor, Global Head of Naphtha and Condensates for Trafigura, said they are pleased to be working with Woodside and its Pluto LNG joint venture participants on what they consider to be the first carbon offset condensate cargo, and for Trafigura, its first carbon offset shipment.
“We’ve set ambitious targets to reduce our operational greenhouse gas emissions and by working with Woodside, which has similar ambitions, it is now possible to offset emissions associated with the cargo from wellhead to delivery. We are developing this offering for other oil products for our customers around the world,” Mr Croitor said.
Note: The term “carbon offset” indicates that the Seller and the Buyer have committed to reduce or offset the amount of carbon dioxide equivalent associated with their respective operated emissions (including the extraction, storage, and shipping of the condensate) through a combination of demonstrated emissions reductions and carbon offsets certified by Verra or Gold Standard.
