Woodside reaches Final Investment Decision for Louisiana LNG Development

Earlier this week, Woodside announced it has formally made a final investment decision of its Louisiana LNG project, a significant milestone that will see the company construct a three-train liquefied natural gas (LNG) facility with a total production capacity of 16.5 million tonnes per annum (Mtpa). The company has set a target to commence LNG production by 2029.

Louisiana LNG Development - Project Details

The Louisiana LNG development is poised to become a cornerstone of Woodside’s global portfolio. Once operational, the company is expected to deliver approximately 24 Mtpa of LNG in the 2030s—positioning it as a key player in the global LNG market with over 5% of worldwide supply.

Permitted for future expansion, the project includes capacity for two additional trains, bringing its total approved output to 27.6 Mtpa. This flexibility underscores the project’s long-term strategic value and potential scalability.

Louisiana LNG - Construction Details

From a construction industry perspective, the Louisiana LNG project stands out as a major undertaking. It is the first greenfield U.S. LNG development to reach a final investment decision since July 2023, and it represents the largest single foreign direct investment in Louisiana’s history.

During the construction phase, the project is expected to support around 15,000 jobs across the United States—highlighting its importance not only as an energy infrastructure project, but also as a significant contributor to local and national economies.

EPC Agreement with Bechtel Underpins Project Delivery

In December 2024, Woodside entered into a revised lump sum turnkey engineering, procurement and construction (EPC) contract with Bechtel for the delivery of the three-train, 16.5 Mtpa foundation phase of the Louisiana LNG development.

Bechtel, which has been active on site since Woodside’s acquisition of the project, was already moving forward with some construction activities under a Limited Notice to Proceed (LNTP) arrangement.

Final Investment Decision - The investment case

According to Woodside, the Final Investment Decision for the project the project is expected to be a significant value driver for the company. According to Woodside, the investment meets and surpasses its internal capital allocation benchmarks. The Louisiana LNG development is projected to deliver an internal rate of return (IRR) above 13% and achieve payback within seven years.

At full capacity, the project is forecast to generate around USD $2 billion in annual net operating cash throughout the 2030s. This would contribute to a projected USD $8 billion in yearly net operating cash flow from Woodside’s global portfolio over the same period.

Woodside also announced that it has already signed a major gas supply agreement for Louisiana LNG project, with a commitment to buy up to 640 billion cubic feet of gas.

Funding Structure and Stonepeak as a partner

The total capital expenditure for the LNG project—including associated pipeline infrastructure and management reserve—is forecast at USD $17.5 billion. Woodside’s share amounts to approximately USD $11.8 billion.

A key financing partner, Stonepeak, will contribute USD $5.7 billion through its investment in Louisiana LNG Infrastructure LLC. This includes 75% of the expected capital expenditure during 2025 and 2026, indicating strong institutional confidence in the project’s delivery and returns.

CEO Comments: “A Game-Changer for Woodside”

Woodside CEO Meg O’Neill described the final investment decision as a pivotal moment in the company’s evolution:

“Louisiana LNG is a game-changer for Woodside, set to position our company as a global LNG powerhouse and enable us to deliver enduring shareholder returns.
“This world-class project is a compelling and de-risked investment. It leverages Woodside’s proven strengths in project execution, operational excellence, marketing and customer relationships to offer significant cash generation and drive long-term shareholder value.
“We have secured quality partners and are now ready to take a final investment decision. This decision is another demonstration of Woodside’s disciplined investment approach, with the project delivering returns that exceed our capital allocation framework.”

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