- Woodside Energy is assessing the impact of U.S. tariffs on its Louisiana LNG project as it prepares to make a final investment decision.
- The company sold a 40% stake in the project to fund 75% of its spending for 2025-2026 and secured an offtake agreement with Uniper.
Woodside Energy, Australia’s leading gas producer, announced on Wednesday that it is evaluating the impact of U.S. tariffs and other trade measures on its Louisiana liquefied natural gas (LNG) plant project.
The project, which is nearing the final approval, was formerly known as Driftwood. Last year, Woodside acquired it from Tellurian for $1.2 billion to strengthen its position as a global LNG powerhouse. The first of the four development phases is expected to cost $16 billion.
In a quarterly update, Meg O’Neill, the CEO of Woodside Petroleum, confirmed that the company is investigating the potential effects of recent U.S. tariff announcements and possible additional trade measures on the Louisiana LNG project. This follows President Donald Trump’s imposition of universal tariffs on nearly all trading partners earlier this month.
O’Neill clarified that the plant operates within a foreign-trade zone, allowing the company to defer tariff payments until each LNG train is completed. However, about half of the equipment and materials needed for the project must be imported. She noted that approximately 25% of Louisiana LNG’s estimated capital expenditure is for equipment and materials, half of which is expected to come from the U.S.
Tim Waterer, Chief Market Analyst at KCM Trade Global, stated that if energy prices faced additional pressure due to tariff-related growth challenges, it could make things more complicated for Woodside.
To improve the project’s financial viability, Woodside announced earlier this month that it had sold a 40% stake in Louisiana LNG’s export terminal to U.S. investment firm Stonepeak. This deal will fund 75% of the project’s spending in 2025 and 2026.
Additionally, the company secured its first offtake agreement with Germany’s Uniper for 1 million tonnes per annum last week.
O’Neill said the company was pleased with the strong interest from potential strategic partners and was actively progressing discussions to sell down more equity. She added that the company was moving quickly towards making a final investment decision on Louisiana LNG, reinforcing Woodside’s ambition to become a global LNG powerhouse.
The update follows the company’s report of $3.32 billion in revenue for the quarter ending March 31, driven by strong gas hub-linked prices and the launch of its Senegal-based Sangomar project. The revenue exceeded the Visible Alpha consensus estimate of $2.79 billion and was a 13% increase from the $2.95 billion reported a year ago.
Quarterly, the company experienced a 5% revenue decline, which was attributed to falling oil-linked prices, cyclone impacts at its North West Shelf project, and unplanned train outages at its Pluto LNG project.
Shares in Woodside rose by as much as 3.9% to A$20.470, while the broader energy sub-index gained 3.1%, in line with rising global oil prices. Woodside maintained its production and capital expenditure forecasts for 2025.