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By P.R. Venkat

  China-backed MMG and Anglo American have agreed to extend the deadline to complete the purchase of the latter's Brazilian nickel business after the European Commission extended its review of the proposed acquisition. 

  "It is unclear how long the European Commission may require to complete its review," MMG said Monday. 

  MMG, majority-owned by China Minmetals, and Anglo American have agreed to extend the deadline for completing the share purchase agreement from Nov. 18 to June 30, 2026. 

  While all the other conditions have been satisfied, the European Commission has escalated its review to a Phase II investigation, MMG said. 

  In early November, the European Commission had said it would deepen its investigation into MMG's $500 million purchase of Anglo American's Brazilian nickel business, citing competition concerns. 

  The commission had said it had preliminary concerns that the deal could divert ferronickel supplies from European markets, potentially raising prices and reducing the quality of stainless steel production in the bloc. 

  Anglo American announced in February that it would sell its Brazilian nickel business to MMG, as part of the U.K.-listed company's efforts to simplify operations following a failed takeover bid from rival BHP last year. 

  "MMG will continue to work with Anglo-American and the European Commission to assist the European Commission in its review," MMG said Monday. 

  Write to P.R. Venkat at venkat.pr@wsj.com 

  (END) Dow Jones Newswires

  November 23, 2025 20:11 ET (01:11 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.

While Woodside has secured a widely criticised extension to its North West Shelf (NWS) liquefied natural gas (LNG) project, its development of the Browse offshore gas field – vital to the NWS’s long-term viability – is looking increasingly shaky. 

The Australian government’s recent decision to extend the licence of the NWS plant to 2070 has generated considerable controversy. Proponents of the project argue that it is needed to ensure energy security at home and in Asia, while opponents point to its large emissions and its impacts on the culturally significant Murujuga rock art nearby. Remarkably, the United Nations has joined legal action against the Government’s decision.

Less focus has been given to Woodside’s proposed Browse gas project, located almost 300km offshore in deep waters. Browse is intended to backfill the NWS as supply from existing fields declines. Having been granted the NWS extension, Woodside is now pursuing approval for Browse. However, the Browse project faces mounting uncertainty given its high costs, developments in LNG markets, and emissions reduction requirements for Woodside. 

There are two major hurdles that Woodside will need to address if it is to develop the Browse field. 

The first is cost. Browse gas will likely be expensive, making it relatively uncompetitive in both the Western Australian gas market and in international LNG markets. IEEFA estimates that Woodside will need a gas price of AUD7.80/GJ to break even on the Browse component of the project.

In terms of LNG exports, this would mean a cost of close to USD8/MMBtu delivered to North Asia (accounting for additional LNG costs). This is well above Qatar’s marginal delivered LNG costs of about USD3.80-5.80/MMBtu, notable given Qatar is a major competitor with Australia and will have large volumes of LNG to sell in coming years.

In terms of the domestic market, this would mean a cost of about AUD9/GJ to deliver Browse gas to Perth. It is about four times higher than the current average production cost of domestic gas in Western Australia, and above current WA gas spot prices. This means Browse gas could potentially place upward pressure on WA gas prices, to levels above the minimum prices that the Australian Energy Market Operator anticipates will induce demand destruction in the Western Australian gas market. The alternative is for Woodside to sell below cost to the domestic market, to the detriment of shareholder returns. 

Meanwhile, LNG markets are hurtling towards a supply glut that will depress prices and intensify competition. While the LNG industry generally expects long-term demand growth to absorb new supply, there are emerging concerns that the LNG glut will persist. For instance, the CEO of TotalEnergies, a major LNG trader, highlighted concerns that the glut could last for years if all planned US LNG projects come online (even as TotalEnergies is progressing with its own US LNG investments). 

Future demand is also uncertain. LNG demand is falling or set to fall in traditional markets, and growth in price-sensitive emerging markets faces structural barriers. The International Group of Liquefied Natural Gas Importers recently pointed to LNG demand uncertainty due to energy demand growth (particularly in Asia) on one side, and emissions reduction targets and growing renewable energy on the other. 

The second hurdle is emissions. The government’s NWS approval includes additional, specific requirements for Woodside to reduce NWS emissions by 60% to 2030, and to net zero by 2050, as well as obligations to reduce or eliminate emissions of certain gases (such as nitrous oxide). The Browse gas fields are also estimated to have a high carbon dioxide (CO₂) content of 10%. Under current rules, this must be fully offset from day one, adding to the requirement to reduce emissions from the NWS plant itself.

The NWS requirements may make it uneconomic to keep the two older trains onlineor at a minimum add significant costs to upgrade them. This could leave only two newer trains, as one train is already offline, thereby reducing LNG production and revenue, and further weakening the economic case for the Browse project.

Woodside has flagged the establishment of a carbon capture and storage (CCS) facility to address reservoir emissions, with planning documents suggesting the facility will capture about 3-4 million tonnes of CO₂ per year (just under half of Browse’s total emissions), with Woodside likely relying on carbon credits to offset reservoir emissions not captured by CCS under Australia’s Safeguard Mechanism. 

However, CCS projects are expensive and typically underperform or fail altogether, with only a handful of sequestration-only facilities achieving carbon injection close to target. Chevron’s Gorgon facility has seen its carbon capture rates fall materially since it began operations, and in 2023-24 captured only 30% of its target. 

Underperformance of CCS facilities has implications for costs, both by increasing the cost of captured carbon (given that fixed project costs are spread over less captured CO₂), and by increasing the amount of offsets required. IEEFA previously estimated that Gorgon CCS had a cost of about AUD222 for each tonne of CO₂ captured due to its underperformance, well above contemporary carbon credit prices. 

In total, the Gorgon facility has cost AUD3.5 billion since its inception and is of a similar scale to the proposed Browse project (with Browse potentially facing additional costs as the facility is located offshore). CCS costs could therefore increase the costs of the AUD37 billion Browse project by about 9%.

Emissions abatement could potentially undermine the project’s competitiveness, both with rival gas sources, and for investment – particularly in the context of declining Australian LNG production. In its Net Zero Transformation modelling, the Australian Treasury has forecast declines in LNG production of 27% to 2035 and 67% to 2050. 

With potentially high project costs and emissions, increasing competition and uncertain demand in LNG markets, Woodside may face an uphill battle convincing investors that Browse is a sound investment. Despite the controversy, the government’s NWS approval may not mean much if Woodside cannot make that case. 
 

This article was first published in Energy News Bulletin.