Woodside and Tokyo Gas discuss stake in US LNG Project

Tokyo Gas and Woodside Energy are in discussions about a possible stake in the multi-billion dollar Louisiana LNG export project. Two people familiar with these talks confirm this.

Woodside, a major Australian oil and natural gas company, closed a deal this month to buy Tellurian Inc., a developer that had put itself up for sale after running out of money while building a U.S. Gulf Coast plant capable of converting shale-gas into LNG at a rate of 27,7 million tons annually.

Tokyo Gas Natural Resources, the U.S. subsidiary of Japan's biggest gas and electricity utility, is in talks to acquire a stake in the project. One person said that the talks are still ongoing, and there's no guarantee of a successful deal.

Woodside and Tokyo Gas have declined to comment.

Woodside is looking for equity partners who will take minority stakes on the Louisiana LNG export project. Meg O'Neill, the chief executive of Woodside, said that "multiple parties" had expressed interest in the project.

Tokyo Gas Natural Resources is the owner of U.S. Shale Gas Production and acquired Rockcliff Energy, a rival gas producer for $2.7 billion late last year. This year, it added to the deal by purchasing a 49% stake of energy marketing company ARM Energy Trading.

The Rockcliff agreement made TGNR a major shale-gas producer in the Haynesville shale area, which straddles East Texas with Louisiana. It can pump up to 1.3 billion cubic foot of gas per day.

Tokyo Gas has a strategy to secure gas supplies from the United States. This strategy, which has already led to a number of acquisitions, is reflected in an equity deal with Louisiana LNG, according to a person who declined to give their name because the discussions are private.

Tokyo Gas President Shinichi Sasayama said earlier this year that the company's U.S. strategy was to "create a U.S. Gas value chain" by linking its projects, in order to maximize their value.

Woodside said that it hopes to have the financial go-ahead for the Louisiana LNG project before the end of the 1st quarter of 2025. The site is under construction and US regulators granted an extension to April 2029 for the completion of the work. Reporting by Curtis Williams and David French, in Houston; additional reporting by Yuka Obaashi in Tokyo; editing by Sharon Singleton.

(source: Reuters)