Australia's Woodside says Saudi Aramco might buy into its Louisiana LNG project
Australia's Woodside Energy said on Wednesday it has agreed to explore opportunities to collaborate with Saudi Aramco, which might take a stake in its $17.5-B Louisiana (U.S.) liquefied natural gas (LNG) project.
Shares in Australia's top gas producer surged nearly 4% after the announcement.
The agreement, which could also see Aramco secure LNG supply, was a "demonstration of the ongoing interest Louisiana LNG is generating among high-quality potential investors," Woodside CEO Meg O'Neill said in a statement.
Woodside in April gave its final approval for the project, confident that a pro-fossil fuel U.S. administration and strong demand would give it competitive returns.
The three-train, 16.5-metric MMtpy project is expected to start producing LNG in 2029.
Woodside has also sold a 40% interest in the company holding the infrastructure assets for the project to U.S. investor Stonepeak for $5.7 B.
MST Marquee senior energy analyst Saul Kavonic said a buy-in from a "quality partner" like Aramco would validate the project's worth to the market. "Aramco aren't doing this just for a few percent of a million tons ... when they go into something, they go big," he said.
Aramco and Woodside are also looking at collaborating in lower-carbon ammonia.
Kavonic also said he expects Woodside to take on additional equity partners based in Asia. Woodside has held talks with buyers such as Tokyo Gas and Japan's JERA.
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