Woodside to Acquire Tellurian, Along with Driftwood LNG Assets

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Written by Daniel Graeber for Industrial Info Resources (Sugar Land, Texas)--With nearly $1 billion on the table, Woodside Energy Group (NYSE:WDS) (Perth, Australia) said Monday it could be a global liquefied natural gas (LNG) "powerhouse" with the acquisition of rival Tellurian Incorporated (NYSE:TELL) (Houston, Texas) and its U.S. assets.

Woodside on Monday made an all-stock offer for Tellurian, with a value of roughly $900 million. Building on its LNG portfolio in the Australian market, Woodside would acquire a stake in the Driftwood LNG export facility under construction on the U.S. Gulf Coast.

"The acquisition of Tellurian and its Driftwood LNG development opportunity positions Woodside to be a global LNG powerhouse," said Woodside CEO Meg O'Neill. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Plant and Project databases can learn more from a plant profile and click here for a list of detailed project reports.

Woodside is building its Scarborough energy complex off the coast of Western Australia, with first gas deliveries expected by 2026. It will be connected to the existing Pluto facility via pipeline and send gas from the Carnarvon Basin to a semi-submersible floating production unit. All told, Woodside expects some 5 million metric tons per year in LNG. Subscribers can read detailed reports on the Scarborough project and its related pipeline.

For its part, Tellurian in 2022 secured the permits necessary for the start of construction at the $15.5 billion Driftwood facility planned for Lake Charles, Louisiana. Phase I will be able to export as much as 1.5 billion cubic feet of LNG per day (Bcf/d).

Baker Hughes Company (NASDAQ:BKR) (Houston) will supply eight gas turbines, compressors and other infrastructure that supports Tellurian's plans to bring Driftwood online in less than five years. Engineering firm Bechtel Corporation (Reston, Virginia) already has completed the foundations for the compressors.

Subscribers can learn more from a detailed project report and plant profile.

In February, the company secured a three-year permit extension to complete construction of its Driftwood export plant. The agreement gave the company until April 2029 to complete construction.

Martin Houston, Tellurian's executive chairman, said senior management weighed the risks associated with a final investment decision and other considerations before deciding the sale would be in the best interest of Tellurian's shareholders.

"Woodside is a highly credible operator, with better access to financial resources and a greater ability to manage offtake risk, and I am confident it is the right developer to take Driftwood forward," he said.

Tellurian generated about $25 million in revenue from natural gas during the first quarter, nearly half as much as during the same period last year. The company blamed the downturn on the bear market for natural gas, where prices are down about 10% on the year.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).