Woodside Energy Group has taken a final investment decision (FID) to develop the three train, 16.5 mill tonnes per annum Louisiana LNG development, formerly known as Driftwood.
The company said it had targeted first LNG in 2029.
Development of Louisiana LNG will position Woodside as a global LNG powerhouse, enabling the company to deliver around 24 mill tonnes per annum from its global LNG portfolio in the 2030s, and operating over 5% of global LNG supply, Woodside claimed.
Louisiana LNG also has the capacity to expand by adding another two LNG trains and is fully permitted for a total of 27.6 mill tonnes per annum.
Woodside also said that the project represented a compelling investment that will deliver significant cash flow and create long-term value for its shareholders.
It exceeds Woodside’s capital allocation targets, delivering an internal rate of return (IRR) above 13% and a payback period of seven years.
At full capacity, the project is expected to generate around $2 bill of annual net operating cash in the 2030s, driving Woodside’s next phase of value creation, giving the company’s global portfolio the potential to generate over $8 bill of annual net operating cash in the 2030s.
The forecast total capital expenditure for the LNG project, pipeline and management reserve is $17.5 bill. As an investor, Stonepeak, will provide $5.7 bill towards the expected capital expenditure for the project on an accelerated basis, contributing 75% of capital expenditure in both 2025 and 2026.
Woodside’s share of forecast total capital expenditure is $11.8 bill.
The company also said that its greenhouse gas emissions reduction targets remain unchanged by the Louisiana LNG FID.
CEO, Meg O’Neill said: “Louisiana LNG is a game-changer for Woodside, set to position our company as a global LNG powerhouse and enable us to deliver enduring shareholder returns.”
Louisiana LNG’s project cost of $15.9 bill, or $960 per tonne, includes EPC, owner’s cost and contingency costs. Pipeline cost is $1.1 bill.
It was recently rumoured that Woodside was looking to sell Louisiana LNG or at least a stake in the project.
