Woodside Powers Ahead in U.S. LNG Market with Major Gas Deal from BP

April 30, 2025 10:46 AM AEST | By Team Kalkine Media

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Woodside Powers Ahead in U.S. LNG Market with Major Gas Deal from BP — Image source: shutterstock

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Highlights

BP to supply 640 billion cubic feet of gas to Woodside’s U.S. LNG project

Deliveries to commence in 2029, securing vital feedstock

Louisiana LNG project targets over 5% of global LNG supply

Woodside Energy (ASX:WDS) is forging ahead with its strategic expansion into the U.S. liquefied natural gas (LNG) market, following a landmark gas supply agreement with BP (NYSE:BP). The deal secures a significant portion of feedgas for Woodside’s large-scale Louisiana LNG development, a key project designed to bolster the company's global LNG footprint.

As per the agreement, Louisiana LNG Gas Management will purchase up to 640 billion cubic feet of gas from BP over a long-term period. Deliveries are scheduled to begin in 2029, aligning with the project's projected operational timeline. This agreement marks a critical milestone for Woodside, serving as the first tranche in a broader portfolio of diversified feedgas sources.

The Louisiana LNG project is expected to deliver approximately 16.5 million tonnes of LNG per annum, positioning Woodside as a major global player with more than 5% share in the international LNG supply market. Its location provides exceptional access to several prolific U.S. natural gas basins, supported by a robust network of interconnecting pipelines—an infrastructure advantage that enhances the project's reliability and commercial viability.

According to Woodside, the deal reflects the project's compelling investment case and its ability to generate long-term value. The final investment decision, announced just a day prior to this supply agreement, underlines the company’s commitment to expanding its LNG portfolio in regions with high growth potential and infrastructure readiness.

Chief Executive Meg O’Neill emphasized that securing this gas supply agreement is a pivotal step, reinforcing confidence in the project’s long-term returns and viability. With the development phase now set in motion, the focus will be on execution and integration, ensuring that the feedgas supply remains aligned with broader project timelines.

Woodside shares saw a slight dip of 0.25% to $20.61 on the Australian Securities Exchange following the news. However, the longer-term strategic implications of this agreement may play a significant role in shaping the company’s earnings trajectory and its positioning in the global energy market.

The partnership with BP reflects growing collaboration among energy giants to meet rising LNG demand while leveraging the U.S.'s rich natural gas reserves and export infrastructure.

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