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(Adds background on Port Arthur, comments from Woodside CEO)
WASHINGTON, June 26 (Reuters) - The chief executive officer of Woodside Petroleum Ltd said on Tuesday that Australia's biggest independent oil and natural gas company will soon decide whether to continue to invest in Sempra Energy's Port Arthur liquefied natural gas (LNG) export project in Texas.
Peter Coleman, who was speaking at the World Gas Conference in Washington, said the project's ability to provide Woodside with an adequate return is "very challenged."
"We've got to make some decisions pretty soon about our continued pursuit (of Port Arthur) with Sempra," said Coleman, noting that Woodside has been paying part of the project's development costs.
"What we've been doing is just paying our way (with Port Arthur), and whether that is going to give us an adequate return, I would say today that is very challenged," Coleman said.
In February 2016, Sempra and Woodside agreed to share the cost of developing Port Arthur, which could result in Woodside buying half the project once the parties made a final investment decision to build the facility.
Officials at California-based Sempra, which announced on Tuesday that Polish Oil & Gas Co (PGNiG) agreed to buy LNG from Port Arthur, were not immediately available for comment.
The Port Arthur project, which Sempra has said could cost $8 billion-$9 billion, includes two liquefaction trains capable of producing about 11 million tonnes per annum (MTPA) of LNG, up to three storage tanks and facilities to load LNG onto ships.
Global LNG imports rose 9.9 percent to 289.8 million tonnes in 2017, according data from the International Group of Liquefied Natural Gas Exporters.
The Port Arthur facility has been in the news a lot recently as Sempra moves closer to a final investment decision. That decision could come in 2019 with first LNG production in 2023, according to the project schedule on the Port Arthur website.
On Tuesday, Sempra and PGNiG signed a 20-year contract at the World Gas Conference in Washington for the sale and purchase of two MTPA of LNG from Port Arthur starting in 2023.
Last week, Sempra said it selected Bechtel as the engineering, procurement and commissioning (EPC) contractor for Port Arthur.
Last year, Sempra signed a memorandum of understanding with Korea Gas Corp (KOGAS) as a potential purchaser of LNG from and equity participant in Port Arthur.
As consumers shift from coal to cleaner burning gas for power generation and other uses, global LNG demand is expected to grow about 4 percent per year through 2035, according to data from Woodside.