Pluto LNG Development Industry Briefing21st November 2006

Agenda

Introduction David Kobelke

Project Overview Lucio Della Martina

Project Scope and Execution Mike Lutz

Onshore Procurement Strategy Trevor Barwick

Onshore Construction / Contract Strategy David Gwynne

Offshore Procurement / Contract Strategy Rob Goodson

Questions & Answers

Close David Kobelke

Project OverviewLucio Della Martina Director - Pluto

Pluto delivers valueGenerates long term cash flows from end 2010Commercialises 4.5 Tcf dry gas (Pluto + Xena) Creates value from commercial and marketing package

Note:All figures are based on current estimates and are subject to change and final Reserve Committee review.Does not include 2006 Production or 2006 Reserve Revision/Additions. Based on 100% equity. Includes condensate.Pluto & Xena are currently Contingent Resource, timing of movement to Reserves is dependant on Technical and Commercial Maturity.

Potential Impact of Pluto and Xena on Woodside Reserve Base

1,244

0

1,000

2,000

YE 2005 2P Reserves Pluto SPA Volumes with KE/TG Unsold Pluto Volume + Xena Volumes

2P R

eser

ves,

WEL

Sha

re (M

Mbo

e)

>35% add to YE 2005 2P

reserves

Pluto creates growth options

Enables expansion -approvals being sought for 12mtpa LNG plant plus domestic gas plant

Drives Woodside’s Carnarvon Basin exploration

Attracts third party gas through open access ‘Burrup LNG Park’

Pluto provides sustainable outcomes

Draws on existing regional infrastructureBuilds capacity in local communitiesSupports cultural heritage preservation by traditional custodians

*as defined by National Trust

Dampier Rock Art Precinct*

Managing cost pressures (Capex A$6 to A$10 billion)− Using NWS Phase V lessons− Integrating contractor synergies− Leveraging frame agreements

Tackling public policy changes− State government domgas & land linkage− Environment − Cultural heritage and management

Taking advantage of tightening 2010-12 LNG supply

Meeting the challenges

Meet Meet customer customer

agreements agreements by end 2010by end 20102003 2005 2006 2007

Perm

it aw

ard

Disc

over

y

Fina

lise

cust

omer

agr

eem

ents

Drill

Plu

to-5

Proj

ect a

nnou

nced

Appr

aisa

l dril

ling

Com

men

ce S

ite P

repa

ratio

n

Xena

dis

cove

ry

Fina

l Inv

estm

ent D

ecis

ion

Site

A E

nv. a

ppro

val

Meeting milestones for 2010 LNG delivery

Proj

ect E

nv. a

ppro

val

Woodside Local Industry Participation Policy

Key points:

Engagement of local industry is fundamental to Woodside’s success.

Maximise local content by giving preference to tenders with higher local content where tenderers are capable and competitive on the basis of health, safety, environment, quality, cost and delivery.

Systematic approach across our activities.

Ensure local capabilities are considered in work planning.

Require contractors to provide training and development opportunities to local workforce.

Meeting the LNG construction challenge

Global LNG demand to double over next decadeIntense competition for resources - exacerbated by WA skills shortageTrain 5 being built as world first modular LNG constructionModular construction a key technology supporting Pluto & Browse

Global LNG Demand LNG construction strategy

Global LNG demand

0

100

200

300

400

2000 2015

LNG

dem

and

(mtp

a)

Train 1-4 Train 5 Pluto Browse Sunrise

Stick Build

Modular

Prop

ortio

n of

Mod

ular

Basicpackages

ModulariseStickbuild

Designmodular

Designoffshoremodular

Repeat

Asia Pacific

Europe

NorthAmerica

2005 2010Source: Poten & Partners

Significant returns to Aust over life of projects

0

1000

2000

3000

4000

5000

Mill

ion

$

Op Ex (Austspend)

Op Ex (OSspend)

Cap Ex (Austspend)

Cap Ex (OSSpend)

WA GovtRoyalties

Total Austspend

Total OSspend

NWSV estimated spend 2005 - 2008

Key messages

LNG by end 2010 is achievable

Challenges being addressed

Greenfields projects such as Pluto offer unparalleled opportunities for local content

Project Scope and ExecutionMike LutzGeneral Manager - Pluto LNG Project

Project Overview

Project Scope

Pluto LNG Scope

LNG Plant comprising of− Process Train− Pig Receiver− Slug Catcher− MEG Regeneration Facility− Plant Utilities− LNG and Condensate Tanks− Administration Buildings, Workshops, Laboratories etc.− LNG Loading Jetty

Platform & Topsides FacilityPipeline / Mono Ethyl Glycol (MEG) LineSubsea Production Wells – Flowlines and Risers

Functional Requirements

Train 5 scope

Project Schedule

2005 2006 2007 2008 2009 2010 2011Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

MILESTONES

SUBSEA & TRUNKLINE

PLATFORM

WELL CONSTRUCTION

ONSHORE PLANT

SITE A PREPARATION

DREDGING & JETTY

LNG SHIPBUILDING

Level 0 Project Summary Schedule DRIMS #3210676 Version 1 20 November 2006

FID 1st LNG

BOD FEED DESIGN , PROCUREMENT & CONSTRUCTION

Commission

BOD FEED DESIGN , PROCUREMENT & CONSTRUCTION HUC

WELLS DESIGN & PROCUREMENT DRILL 5 WELLSStart 1st. Well

BOD

Award Contract

FEED DESIGN , PROCUREMENT & CONSTRUCTION Commission & Cooldown

SITE A PREP.

CONSTRUCT JETTY AND DREDGING

SECURE SHIPPING PARTNER

Execute Time Charters

SHIP CONSTRUCTION

ShipyardCut Steel 1st Ship

Delivery

Promoting Local Content

Tenders for material and equipment will be called both locally and offshore.

Adequate time will be allowed to enable local companies to joint venture with offshore companies where specialist expertise is required.

Frame agreement in place with ICNWA to identify and capture opportunities for Australian participation.

Engineering and Procurement will be executed in each of the EPCM contractor’s offices.

Approval for all Procurement Plans and Recommendations for Award is required from Woodside prior to a commitment being placed.

Project Objectives

The aim for this project is to be recognised for exemplary performance in:

Maximising the value of Woodside assets.

Health and safety of all personnel involved in its execution and subsequent operation

Protection of the environment

Maximising opportunity for Australian suppliers and contractors where capable and globally competitive

Providing qualified individuals and enterprises of the local Indigenous community with job opportunities.

Australian Industry Participation Plan

Overarching document to accomplish project objectives in maximising opportunities for local involvement.

Reflects WEL corporate objectives in providing full, fair and reasonable opportunity where capability, global competitiveness on HSE, quality and delivery exist.

Will ensure material selection considers grades and types locally available for local fabrication and manufacture.Specifies requirements for precise and regular reporting on local content

Will ensure utilisation of local database for potential local supplyICNWAProjectConnectPhase V Vendor/Supplier Lists

Project has formal agreement with ICNWA to further identify local capabilityICNWA will directly assist in formulation of Procurement PlansICNWA is currently updating the Pilbara Services Directory to identify Indigenous Capability. This will be incorporated into ProjectConnect.

Onshore Procurement StrategyTrevor BarwickFoster Wheeler WorleyParsons Procurement Manager

Onshore fly-over

Onshore Procurement Strategy

ScopePurchasing, material control, expediting, inspection & logisticsEquipment A$760 m (indicative)Bulk materials A$480 m (indicative)Number of packages 180 - 250 (indicative)

Supply Strategy Repeat items - Negotiated supply where competitive & schedule compliant.Competitive tendering - non repeat items and wherever negotiations for repeat supply fail.Use of Australian Specifications.Full & fair opportunity for Australian industry to participate where capable and competitive – second tier opportunities will be promoted to enable entry to global supply chain.

Scope broader than Train 5

Train 5 scope

Onshore Procurement Strategy

Vendor Pre-qualification ProcessPhase V (and IV) performanceTechnical, Quality Assurance, Commercial, CapacityIndustry Capability Network Western Australia coordination

ProjectConnectOnshore Long Lead Items

Onshore Other Procurement ItemsOnshore ContractsSecond tier opportunities

Tender ProcessRequest for Tender

− Web based tendering − Sealed tender protocol

Onshore Procurement Strategy

Tender Evaluation Criteria

Technical conformance to specificationsQualityPhase V benchmarking for repeat items Commercial

– Price / Terms and Conditions– Delivery– Capacity

Onshore Procurement Strategy

Worldwide Logistics

International Freight Forwarder

Retains overall responsibility – subcontract to specialist companies− Export liaison− Ocean freight (to fabrication yards, Fremantle or Dampier)− Customs clearance− AQIS compliance − Warehousing / Marshalling in Perth− Transportation to Pre Fab site− Transportation from Australian suppliers’ works to site

Construction / Contract StrategyDavid GwynneFoster Wheeler WorleyParsons Construction Director

Construction Scope of Work

On SiteSite Preparation / Temporary FacilitiesLNG and Condensate TanksCivil WorksDredgingJettyMechanical and PipingElectrical and InstrumentsInfrastructure BuildingsInsulation and Painting

Off SitePre-Assembly / Module YardsSteel fabricationPipe fabrication

Tangible Quantities (Indicative)

Major Equipment pieces 500Earthworks (Excavation & Backfill) 1,900,000 m3Concrete (Foundations & Paving) 100,000 m3Structural Steel 26,000 tonnesAbove Ground Piping 200,000 mUnderground Piping 15,000 mUnderground Electrical Cable 350,000 mAbove Ground Power & Control Cable 400,000 mInstrument Cable 500,000 mLighting Cable 200,000 mEarthing Cable 100,000 m

Construction Execution Strategy

On site worksMaximise practical and cost effective prefabrication

Early award of pre-assembly & site preparation and civil works

Engage Erection Contractors to execute on-site workDirect work packages Discipline basedKey Erection Contractors identified and pre-qualified earlyKey Erection Contractors involved in pre-construction detailed planning:

− Identification of interfaces between disciplines,− Resource planning and Resource levelling,− HSE, IR, ER and quality management plans.

Commissioning and Start-Up assistance within scope of Erection Contracts.

Contracting Strategy

Prefabrication & Pre-assembly:Maximisation of Australian content subject to global competitiveness.Competitiveness measured on basis of costs delivered at site (Burrup).

Site Preparation, Civil and general services contracts:Tendered competitively within Australia.

Key “Above Ground” erection contracts:Mechanical, Electrical & Instrumentation, Insulation & Painting.Pre-qualified Australian Contractors.

All contracts:Selection criteria: proven capability & capacity to manage HSE, IR, ER, quality of work and productivity.Selection weighted towards indigenous participation via employment and subcontractor opportunities.

Karratha Business Opportunities

Office MaintenanceBuilding, plumbing, air-conditioning

Site Maintenance and Misc. WorkMinor temporary civil worksRoad maintenance

Lifting Services

Office Equipment and Supplies

Construction SuppliesProvision of non-permanently installed material

Vehicle Supply and Maintenance

Accommodation

Concrete Supply

Indicative Construction Schedule

O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J

Site A Preparation

Tanks

Jetty

Dredging

Civil Works

Mechanical and Piping

Electrical and Instruments

Insulation and Painting

Site B Preparation

Civil Works

Buildings

Module Deliveries

Mechanical and Piping

Electrical and Instruments

Insulation and Painting

Commissioning

20102006 2007 2008 2009

Indicative Project Personnel on Site

Indicative Project Personnel on Site

2000Directs only

1500

1000

500

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q42007 2008 2009 2010

Indicative Contract Plan

Indicative Contract Plan

Contract Package Supply Scope

Tender Mobilise

On SiteSite Preparation & Temporary Facilities Construct Q3 - 06 Q4 - 06Civil Works Supply/Construct Q1 - 07 Q3 - 07LNG & condensate Tanks Design/Supply/Construct Q3 - 06 Q1 - 07Dredging Construct Q4 - 06 Q1 - 07Jetty Design/Supply/Construct Q4 - 06 Q1 - 07Piping & Mechanical Work Construct Q2 - 07 Q4 - 07Electrical & Instrument Works Construct Q3 - 07 Q1 - 08Buildings Design/Supply/Construct Q3 - 07 Q1 - 08Telecoms Construct Q3 - 07 Q1 - 08Infrastructure Construct Q3 - 08 Q1 - 08Scaffolding Supply/Erect Q3 - 07 Q1 - 08

OffsitePre-assembly/Module Yard Fabricate/Assemble Q4 - 06 Q2 - 07Steel Fabrication Fabricate Q2 - 07 Q4 - 07Piping Fabrication Fabricate Q2 - 07 Q4 - 07

Planned

Contract Plan

Project Overview / ExecutionRob GoodsonOffshore Project Manager - Pluto LNG Project

Offshore fly-through

Offshore Facilities

Location ~190 km offshore, water depth ~85m

Riser Platform - Not Normally Manned

Minimal Facilities – Low Operation & MaintenanceNo ProcessPigging of flowlines & trunklineMetering Chemical InjectionInstrumentation, Controls, CommunicationsOperated from Onshore Control Room

Act as Hub for gas gathering from other fields

Platform Configuration

Multiple risers & J-tubes for Pluto production and compressionTwo or more other fields (other Operators)Export trunkline & MEG line

Other FacilitiesFlareCraneHelideckEmergency Shelter / Utilities RoomSafety EquipmentProvision for bridge connection to compression platform

Platform Substructure

Foundations present major technical challenge

Platform location driven by foundation issues

Substructure type not yet selected

Type selection by January 2007

Substructure Alternatives

Launched JacketDrilled & Grouted PilesLift installed topsides

Launched JacketBallasted Gravity MatLift installed topsides

Self Installing PlatformBallasted Gravity MatTopsides pre-installed

Offshore Procurement Strategy

Scope

EOS will provide purchasing, material control, expediting, inspection & logistics for offshoreEquipment $ 10mBulk Materials $ 20mNumber of Packages 20 packages

Supply strategy

Frame agreements for subsea hardware, process control system, drilling consumablesCompetitive tendering – equipment packages & bulk materials Full & fair opportunity for Australian industry where capable & competitive

Offshore Procurement Strategy

Vendor Pre-qualification Process

WEL / EOS / JPK / FMC Project performanceTechnical, Quality Assurance, Commercial, CapacityIndustry Capability Network Western Australia coordination

ProjectConnect

Equipment packages and bulksPlatform FabricationWell Delivery Materials and Services

Tender Process

Request for Tender− Web based tendering− Sealed bid protocol

Offshore Procurement Strategy

Tender Evaluation criteria

Technical compliance to specificationsHSE & QualityCommercial

−Price / terms & conditions−Delivery −Cost & schedule performance risk

Questions & AnswersModerator – David Kobelke

Yaandina Family Services, RoebourneModerator – David Kobelke

Yaandina Family Services, Roebourne