Woodside Energy, Australia’s leading energy firm, has taken a significant step in the U.S. market by securing a $5.7 billion investment from a private equity company based in New York. This funding will support a major liquefied natural gas project in Louisiana.
The firm Stonepeak, which focuses on infrastructure investments, plans to take a 40% share in the Louisiana LNG project, formerly known as Driftwood. This development requires the construction of 150 kilometers of pipelines and aims to produce 27.6 million tonnes of natural gas each year.
While Woodside is keen on bringing in additional equity partners for this project, it intends to keep at least 50% ownership for now. The announcement came amid a drop in the Australian stock market, influenced by fears of a global recession linked to tariffs from the Trump administration.
Despite the positive news from the U.S., Woodside’s shares fell by 7% on the Australian Securities Exchange, highlighting the market’s broader concerns, particularly in mining and oil stocks. However, the deal has eased worries that Woodside would have difficulty finding partners for its Louisiana venture.
This recent equity deal reflects a growing trend in which firms collaborate with private equity groups to finance large-scale infrastructure initiatives, leveraging their capacity to secure substantial debt. For instance, last year, Apollo Global Management invested $5 billion in a new Intel manufacturing facility in Ireland, and Stonepeak has also teamed up with Dominion Energy on an offshore wind project in Virginia.
Meg O’Neill, Woodside’s CEO, expressed confidence in the investment, noting that it reinforces Louisiana LNG’s status as a valuable asset expected to yield long-term returns for shareholders.
With its roots in the U.S. markets enhanced by its merger with BHP’s oil and gas division in 2022, Woodside had also acquired Tellurian—a struggling LNG developer—for $1.2 billion. This acquisition was part of a strategy to expand its influence in the global gas market and lessen its reliance on exports from Australia.
Analyst Saul Kavonic from MST Marquee indicated that while the partnership with Stonepeak alleviates immediate financial concerns for Woodside, more stake sales and contracts will be necessary to maximize the potential of this investment.
The strategic agreement comes at a time when the U.S. administration has indicated a desire to boost domestic oil and gas production, a move that has been juxtaposed with concerns about investment in renewable energy developments in Australia.
Stonepeak manages $72 billion in assets and focuses on infrastructure investments. The deal involved advisory support from Mizuho, Santander, and law firms including Simpson Thacher & Bartlett and Paul Weiss, while Woodside engaged RBC Capital Markets, Evercore, and Norton Rose Fulbright for their advisory needs.