Australian energy giant Woodside Petroleum on Monday announced a 2.5 billion dollar (2.3 billion US) share offer to boost its ambitious push into the booming liquefied natural gas (LNG) sector. Woodside, which aims to be among the world's top LNG producers by 2020, said the fundraising would boost three developments in Western Australia, home of the country's burgeoning LNG industry.
"The funding will strengthen Woodside's balance sheet and increase liquidity in preparation for further liquefied natural gas development," the company said in a statement. Australia's top publicly listed oil and gas company said shareholders would be offered one new share at 42.10 dollars for every 12 already owned, a 10 percent discount on Friday's 47.18 dollar close. It said top shareholder Shell had already confirmed it would take up its entitlement in full, an investment of about 862 million dollars.
Woodside has stakes in Western Australia's North West Shelf joint venture and the proposed Browse, Sunrise and Pluto plants, part of a growing collection of LNG projects in Australia. "(Our growth projects) may all come together; they may all be stretched apart quite significantly," Woodside chief financial officer Mark Chatterji said last month.
"If they all come together we'll obviously outrun our existing balance sheet capacity." Australia has already signed contracts worth tens of billions of dollars with Asian countries for the clean-burning LNG, which is turned liquid for shipping then back to gas for use on arrival.
Analysts say the country can become "the Middle East of gas", with government forecasts predicting exports will quadruple to 60 million tonnes a year by 2015 from 2006 levels if all planned projects proceed "The numbers are phenomenal. When you look at them it's mind-boggling," State One Stockbroking analyst Peter Kopetz told AFP in August. "It's going to be LNG boom times."
Western Australia's Gorgon project alone is expected to generate 300 billion Australian dollars in export earnings, according to the government, after it got the formal go-ahead in September. The project's partners have already signed off on supply contracts with China, Japan, India and South Korea worth a combined 145 billion Australian dollars, including ExxonMobil's record 50 billion dollar deal with PetroChina.
"Gorgon will supply cleaner burning natural gas for the growing Asia-Pacific and Australian markets, create thousands of jobs, and generate substantial revenue for Australia," senior Chevron executive Jim Blackwell said. Woodside shares were in a trading halt Monday.