Woodside and Williams Forge Strategic Partnership for Louisiana LNG Project
Woodside has officially completed a major transaction with Williams, a leading US natural gas infrastructure company, establishing a strategic partnership aimed at advancing the Louisiana LNG project. This integrated investment marks a critical milestone in Woodside’s broader strategy to expand its global LNG footprint, while leveraging the unique capabilities of a partner with deep expertise in US midstream operations.
Under the agreement, Woodside has sold a 10% equity stake in Louisiana LNG LLC (HoldCo) and an 80% interest, along with operational control, of Driftwood Pipeline LLC (PipelineCo) to Williams. The transaction, valued at US$250 million as of the effective date of January 1, 2025, also includes proportionate reimbursement of capital expenditures since that date, bringing total proceeds received to $378 million. The deal was signed and closed simultaneously, underscoring the swift alignment of both parties on strategic objectives and financial commitments.
The partnership is designed to create a strong foundation for the Louisiana LNG project by securing capital and offtake commitments, while also bringing on board a partner with complementary expertise in gas sourcing, pipeline operations, and infrastructure management. Williams’ existing platform, Sequent Energy Management (Sequent), will play a pivotal role in the project, providing operational gas supply and marketing capabilities that will help optimize the LNG facility’s feedgas strategy.
As part of the investment, Williams will contribute to the capital expenditure required for the LNG facility and pipeline, totaling approximately $1.9 billion. In addition, the company assumes LNG offtake obligations for 10% of the production, further demonstrating its commitment to the project’s long-term success.
Williams operates more than 33,000 miles of pipeline across 24 US states, and its Sequent platform has a marketing and optimization footprint of over 7 billion cubic feet per day (Bcf/d). Leveraging this extensive experience, Williams will construct and operate the Line 200 pipeline, which will supply natural gas to the Louisiana LNG terminal. The integration of Sequent’s gas sourcing and marketing expertise will ensure that daily gas procurement, balancing, and optimization are efficiently managed in line with Louisiana LNG’s strategy.
Woodside CEO Meg O’Neill expressed her excitement at welcoming Williams to the Louisiana LNG project. “We are thrilled to have Williams join us as a strategic partner,” O’Neill said. “Their leadership in US natural gas infrastructure, combined with their operational expertise, adds significant value to Louisiana LNG. This partnership leverages Woodside’s proven LNG development and global marketing capabilities alongside Williams’ deep experience in pipelines and gas sourcing. Together, we are well-positioned to meet growing global energy demand.”
O’Neill highlighted the broader significance of the partnership. “With strong contracting momentum from Louisiana LNG and our wider portfolio, along with support from existing infrastructure partner Stonepeak and key contractors including Bechtel, Baker Hughes, and Chart, we remain on track to deliver the first LNG in 2029. This partnership is a key step toward creating long-term value for our shareholders.”
Williams President and CEO Chad Zamarin also emphasized the strategic importance of the deal. “This transaction represents a significant advancement in Williams’ wellhead-to-water strategy, integrating upstream, midstream, marketing, and LNG capabilities,” Zamarin said. “Partnering with Woodside allows us to reinforce our role as a trusted provider of sustainable energy solutions, delivering reliable energy to global markets.”
Transaction Structure and Operational Details
Under the terms of the deal, Williams holds a 10% stake in Louisiana LNG LLC (HoldCo), with the remaining 90% retained by Woodside. HoldCo, in turn, owns a 60% interest in Louisiana LNG Infrastructure LLC (InfraCo), with the balance held by Stonepeak. For Driftwood Pipeline LLC (PipelineCo), Williams holds 80% equity and manages the construction and operations of the Line 200 pipeline, while Woodside retains 20%.
HoldCo continues to lead the overarching gas procurement strategy, executing agreements extending beyond 12 months. Operationally, a gas supply team, led by Williams and supported by Woodside secondees, will manage daily gas sourcing and balancing. The optimisation value generated by this team will be distributed to HoldCo, ensuring all stakeholders benefit from efficient gas management practices.
Williams’ LNG allocation from the Louisiana LNG project will total 1.6 million tonnes per annum (Mtpa), supplied under a long-term LNG sales and purchase agreement (SPA). Approximately 1.5 Mtpa of this LNG will be delivered under a new SPA with Williams, while the remaining 10% will be sourced from the Louisiana LNG 1.0 Mtpa SPA previously signed with Uniper.
The transaction officially took effect on January 1, 2025, with completion occurring simultaneously. In addition to the $250 million upfront contribution representing Williams’ share of acquisition and development costs, the company reimbursed its proportionate share of capital expenditures incurred since the effective date, bringing total proceeds to $378 million.
Financial and Strategic Impact
Woodside’s total capital expenditure for the Louisiana LNG project is now estimated at $9.9 billion, reduced from the $11.8 billion originally projected at the final investment decision (FID). The restructuring allows HoldCo to remain consolidated in Woodside’s year-end financial accounts, while PipelineCo will be deconsolidated and recorded as an equity investment going forward.
The transaction also underscores Woodside’s commitment to maintaining a balanced capital structure while leveraging strategic partnerships to enhance operational efficiency. Woodside’s financial advisors for the transaction were RBC Capital Markets and Evercore, with Norton Rose Fullbright serving as legal adviser.
