Woodside this morning said it would team up with US firm, Crystal Energy, to develop the 6 million tonne per annum (mmtpa) Clearwater Port LNG import facility 21 kilometres off Ventura County, by converting the Grace oil and gas production platform into a receival terminal and installing pipelines to the Californian coast.

Under a heads of agreement, Woodside will provide technical expertise and has agreed in principle to operate Clearwater Port in exchange for preferential access rights to the terminal.

Woodside will also provide funding to progress required project approvals through US state and federal agencies.

Woodside’s chief executive officer, Don Voelte, said the two companies complemented each other perfectly.

“Woodside has substantial gas reserves and world-wide experience in LNG production and transportation while Crystal provides an ideal potential entry point to the world’s largest gas market,” Voelte said.

A company statement said Crystal Energy was formed specifically to permit and operate the Clearwater Port development.

“Our record of reliability, safety and environmental management makes us the right partner to help fulfill the energy needs of California.

“Our involvement in Clearwater Port represents a further step in Woodside’s strategy of securing markets for our Australian gas reserves and assists California to secure a long-term, clean, and reliable energy source.”

Crystal has applied to the US Coast Guard for a deepwater port licence for Clearwater Port which involves conversion of the Grace oil and gas platform 21km (12.6 miles) off Ventura County in 97 metres (318 feet) of water. The proposal does not include offshore LNG storage as the gas will be directly transferred from tankers into pipelines that will be tied into onshore infrastructure using existing easements.

The terminal is being designed to accept a base capacity of about six mmtpa, or about 800 million standard cubic feet a day.

“The offshore location, the use of an existing platform and the project design will minimize environmental and social impact,” Voelte said.

“The project concept uses established technologies with low capital costs to present a competitive energy supply option for California.”

In the United States, Woodside has interests in 181 deepwater and shallow water exploration blocks covering about 3500sqkm (1350sqm) of the Gulf of Mexico, including the Neptune oil and Midway gas discoveries.