Australian LNG players Woodside and Santos confirmed that the two firms are in discussions regarding a potential merger.
“In response to recent media speculation, Woodside confirms it is in discussions regarding a potential merger with Santos,” the firm said on Thursday.
Woodside said discussions remain confidential and incomplete, and there is no certainty that the discussions will lead to a transaction.
“As a global energy company, Woodside continuously assesses a range of opportunities to create and deliver value for shareholders,” it said.
Santos confirmed the talks in a separate statement on Thursday saying that it has engaged in preliminary discussions with Woodside regarding a potential merger.
The firm said it “continuously reviews opportunities to create and deliver value for shareholders.”
Santos said the consideration of any merger is at an early stage and there is no agreement between the two firms.
The combination of the two firms would create a merged energy and LNG giant with a market value of about A$80 billion ($52.4 billion).
Last year, Woodside completed its merger with BHP’s oil and gas business, becoming a top 10 global independent energy company by hydrocarbon production and the largest energy company listed on the ASX.
Woodside is the operator of the Pluto LNG plant and is building the second train there, and it operates the NWS LNG plant. The firm has stakes in other facilities as well and is working to develop new projects such as the Sunrise project.
On the other hand, Santos completed its merger deal in December 2021 with PNG-focused Oil Search worth about A$22 billion.
With this move, Santos increased its stake in the PNG LNG project. The company operates the Gladstone LNG plant and the Darwin LNG plant.