Woodside and Tokyo Gas in discussions over stake in US LNG project

Woodside Energy

31/10/2024 16:52

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      Tokyo Gas aims to build 'value chain' using US gas assets
    

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      Australia's Woodside seeks partners for Louisiana plant
    

  
    By Curtis Williams and David French
       HOUSTON/NEW YORK, Oct 31 (Reuters) - Tokyo Gas  9531.T 
is in talks with Woodside Energy  WDS.AX  over taking a stake in
a multi-billion-dollar Louisiana liquefied natural gas (LNG)
export project, according to two people familiar with the
discussions.
    Woodside, an Australian oil and gas producer, this month
closed on a $1.2 billion buy of developer Tellurian Inc, which
put itself on the market after nearly running out of cash
building a U.S. Gulf Coast facility that could convert U.S.
shale gas into up to 27.7 million tons per annum of LNG.
    Tokyo Gas Natural Resources (TGNR), the U.S. arm of Japan's
largest gas and power utility, is holding talks on acquiring an
interest in the project. The talks are ongoing and there is no
guarantee they will complete a deal, one of the people said.
    Woodside and Tokyo Gas declined to comment.
    Woodside has said it is seeking equity partners to take
minority stakes in the export project, now called Louisiana LNG.
Chief Executive Meg O'Neill said earlier this month the company
had received expressions of interest from "multiple parties." 
    Tokyo Gas Natural Resources owns U.S. shale gas production
and late last year acquired rival gas producer Rockcliff Energy
for $2.7 billion. It added to that deal this year by buying a
49% stake in energy marketing firm ARM Energy Trading. 
    The Rockcliff deal made TGNR one of the largest shale gas
producers in the Haynesville shale region, which straddles East
Texas and Louisiana. It can pump more than 1.3 billion cubic
feet per day of gas. 
    An equity deal involving Louisiana LNG would be part of
Tokyo Gas' strategy of securing gas supply from the United
States, a strategy which already has led to several
acquisitions, said one of the people who declined to be
identified because the talks are private. 
    "Our aim is to create a U.S. gas value chain by linking our
projects to increase the value of our investments, rather than
seeking profits from individual projects," Tokyo Gas President
Shinichi Sasayama told Reuters earlier this year about its U.S.
strategy.
    Woodside has said it hopes to be able to give a financial
greenlight to the Louisiana LNG project by the end of the first
quarter of 2025. Construction at the site has been underway and
U.S. regulators this year granted the project an extension until
April 2029 to complete the work.  

 (Reporting by Curtis Williams in Houston and David French in
New York; additional reporting by Yuka Obayashi in Tokyo;
Editing by Sharon Singleton)
 ((Curtis.Williams@thomsonreuters.com; +1 346 324 7560;))