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O’Neill said during Woodisde’s earnings call on Tuesday that the company has “a number of high-quality counterparties with whom we are negotiating as we speak. The pricing point we will communicate in due course.”
She said the “key thing that we’re focused on with the sell-down is making sure we have those co-investors to share the capital investment. There is still quite a bit of spend facing us ahead as we move forward into this investment.”
“So we’re focused on getting partners who will share the capital, see that same long-term value that we see, and we’ll be getting a price that we think is attractive and fair for our shareholders,” O’Neill said.
In October 2024, Woodside acquired all issued and outstanding Tellurian common stock for about $900 million cash, or $1.00 per share. The implied enterprise value is about $1.2 billion.
Woodside also renamed Tellurian’s Driftwood LNG project Woodside Louisiana LNG.
Bechtel contract
In December 2024, Woodside signed a revised engineering, procurement, and construction (EPC) contract with US engineering and construction firm Bechtel for the Louisiana LNG export project.
The lump sum turnkey deal is for the three-train 16.5 million tonnes per annum foundation development of Louisiana LNG.
Woodside said total Louisiana LNG expenditure from December 2024 to the end of the first quarter of 2025 is forecast to be up to $1.3 billion, which is included in the overall estimated cost for the foundation development.
Answering a question during the call about the EPC contract, O’Neill said having a priced EPC contract with Bechtel is “differentiating.”
“So if we look at many of the competing US Gulf Coast or even the Mexican Gulf Coast projects, there are very few that have that attribute,” she said.
“So we’ve got everything fully locked in with Bechtel from a pricing perspective. It is for three trains. And the marketing we’ve been doing with our potential partners is focused on that foundation development of three trains,” she said.
“Now, the mechanics with which we progress to full notice to proceed, the first notice will be for trains one and two, and there’ll be a subsequent notice for train three. But again, the pricing is based on three trains and our expectation and the expectation we’re communicating to all of our prospective partners is that the plan is to move ahead with the foundation,” O’Neill said.
FID
During the call, O’Neill was also asked about the final investment decision and its relation to the sell-down.
“It’s worth noting what we’ve said is we want to be FID-ready from the first quarter of this year, and the teams are working very hard to that objective,” she said.
“But we would not take FID without confidence that we have partners either signed up already or extremely close to signing up. I think Scarborough Pluto Train 2 is a fantastic analogy,” she said.
“So, with the whole Scarborough development, we were able to secure a sell-down of 49 percent of Pluto Train 2, kind of coincidence with FID. And then we were patient to bring in other partners to the offshore resource,” O’Neill said.
Woodside sold a 15.1 percent non-operating participating interest in the Scarborough JV to Japan’s Jera and it sold a 10 percent non-operating participating interest to LNG Japan, a joint venture consisting of Japan’s Sojitz and Sumitomo.
O’Neill said Woodside has seen “great interest” in Louisiana LNG sell-down.
“I think there’s potential for us to have the whole 50 percent sold down by FID. But again, it is complex commercial negotiations. So, we will be certainly well advanced if not signed with one key partner and then continue to be progressing,” she said.
“But the team certainly got their skates on. We’re deep in negotiations with a number of, as I said, high-quality counterparties. And we’ll let the market know when we’ve got something announceable,” she said.