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Australian energy major Woodside has entered into a definitive agreement to acquire Houston-based LNG exporter Tellurian, including its owned and operated US Gulf Coast Driftwood LNG development.
The consideration for the transaction is an all-cash payment of approximately $900m. The implied enterprise value is approximately $1.2bn. According to Woodside, this represents an entry into an opportunity with more than $1bn of expenditure incurred to date.
Tellurian’s board of directors has approved the transaction and has recommended that its shareholders also approve it. The transaction is set to be completed in the fourth quarter of 2024.
Woodside will also provide a loan to Tellurian of up to $230m to ensure Driftwood LNG site activity and de-risking activities maintain momentum before the completion of the transaction. The latest maturity date for the loan is December 15 or the date of transaction completion.
As for Driftwood LNG, it is a fully permitted, pre-FID development opportunity located near Lake Charles, Louisiana. The current development plan comprises five LNG trains through four phases, with a total permitted capacity of 27.6Mtpa. Woodside is targeting FID readiness for the 11Mtpa Phase 1 of Driftwood LNG from the first quarter of 2025.
The contracting strategy is a lump-sum turnkey contract with LNG contractor Bechtel. Construction has started with pilings for Trains 1 and 2 complete, foundation work in progress, and pilings underway for the LNG tanks.
“The acquisition of Tellurian and its Driftwood LNG development opportunity positions Woodside to be a global LNG powerhouse. Through this acquisition, we are delivering on our strategy to thrive through the energy transition [with] LNG playing a key role,” said Meg O’Neill, Woodside CEO. |
