Woodside Energy has taken a $27 billion final investment decision on its Louisiana LNG project in the United States, in a move the company says will make it a global LNG powerhouse.
Woodside Energy has taken a $US16.5 billion ($27 billion) final investment decision on its Louisiana LNG project in the United States, in a move the company says will make it a global LNG powerhouse.
The construction of Louisiana, which was acquired in Woodside’s acquisition of Tellurian, is expected to generate around $US2 billion per annum in annual net operating cash in the 2030s.
Woodside will spend $US11.8 billion on the infrastructure required for Louisiana LNG, with Stonepeak chipping in $US5.7 billion after taking up a stake in the project’s infrastructure holding subsidiary earlier this year.
Stonepeak will contribute 75 per cent of the capital expenditure required at Louisiana in 2025 and 2026.
The pair expect Louisiana to pay itself back over seven years, with an internal rate of return of around 13 per cent.
The project will produce 16.5 milion tonnes of LNG per annum, lifting Woodside's total deliveries to 24 million tonnes of LNG globally per annum in the 2030s – a market share of more than five per cent.
First LNG is targeted for 2029.
Woodside chief executive Meg O’Neill said the project was a milestone moment for the company and jurisdiction, highlighting the support it had received from US federal and state officials.
“Louisiana LNG is a game-changer for Woodside, set to position our company as a global LNG powerhouse and enable us to deliver enduring shareholder returns,” she said.
“This world-class project is a compelling and de-risked investment.”
Ms O’Neill said Louisiana would allow Woodside to balance its portfolio, with a strategic position in the US and Atlantic and Pacific regions.
“The project benefits from access to abundant low-cost gas resources in the United States and boasts an asset lifespan of more than 40 years,” she said.
“It also has access to well-established interstate and intrastate gas supply networks.
“The marketing opportunities Louisiana LNG offers across the Pacific and Atlantic Basins leverages Woodside’s proven LNG marketing capabilities and complements our established position in Asia.
“This will position Woodside to even better serve global customers and meet growing energy demand.”
The investment will be the single largest in Louisiana’s history and the first US greenfield LNG project to take FID in almost two years.
It will create around 15,000 jobs during construction.
Woodside continues to explore equity sell-downs at Louisiana and said it had received strong interest from potential partners.
“This will further reduce Woodside’s capital and accelerate the value of Louisiana LNG and is consistent with the approach we have taken with our Scarborough energy project in Australia,” Ms O’Neill said.
Woodside shares were flat in early trade, at $20.36.
