PERTH, May 3, 2026, 22:02 (AWST)
Woodside Energy Group’s Louisiana LNG project is facing a pricing test, after Reuters reported that potential buyers have pushed back on the liquefaction fees the Australian producer is seeking for volumes from the planned U.S. export plant. Liquefaction fees are the charges paid to cool natural gas into liquid form so it can be shipped by tanker.
That matters now because Louisiana LNG is one of Woodside’s biggest growth bets and sits at the centre of CEO Liz Westcott’s early push to show capital discipline. The company said last week the project’s foundation phase was 24% complete, remained on budget, and was targeting first LNG in 2029.
Reuters, citing two people familiar with the matter, said Woodside initially sought fees above $2.80 per million British thermal units, versus broader U.S. market rates of about $2.40 to $2.50. The same report put Cheniere Energy near $2.60 and Venture Global around $2.30, a direct competitive marker for Woodside as it tries to sign long-term buyers.
Woodside has so far announced one long-term sales agreement for Louisiana LNG, with Germany’s Uniper, covering up to 2 million tonnes a year. Reuters said that equals about a quarter of Woodside’s share of the plant’s output, outside the roughly 8 million tonnes Woodside plans to keep for its own portfolio.
The company declined to comment to Reuters. Westcott said after Woodside’s annual meeting that customer interest remained strong and that the company was “well priced in the market,” adding it was “one of the lower-cost LNG suppliers.” Reuters
The buyer pushback lands just days after Woodside reported first-quarter operating revenue of $3.26 billion, up 7% from the previous quarter but down 2% from a year earlier. Production fell 8% to 45.2 million barrels of oil equivalent after cyclone-related disruptions in Western Australia, while average realised prices rose 11% to $63 per barrel of oil equivalent.
Westcott said Severe Tropical Cyclone Narelle hit output late in the quarter, but higher spot prices should feed into later LNG earnings because many LNG contracts price with a lag. She also said “cost discipline is essential” as Woodside starts a structured business review to cut complexity and sharpen accountability. Business Wire
Marc Jocum, senior product and investment strategist at Global X ETFs, told Reuters the market would look for “mid-single-digit efficiency gains” from that review, implying about $100 million to $200 million in annual savings across Woodside’s operating and corporate cost base. Reuters
Woodside’s ASX-listed shares closed Friday at A$33.12, down 1.28%, with the Australian market shut over the weekend. Its U.S.-listed stock last traded Friday at $23.53.
But the risk is plain: if buyers hold firm on price, Woodside may have to accept lower fees, carry more LNG through its own portfolio, or wait longer for contracts that help de-risk the project. Woodside has also said Bechtel is sourcing Louisiana LNG structural steel from the United Arab Emirates and that fabrication has not been hit, though mitigation measures are being assessed to protect ongoing supply.
Woodside approved the three-train, 16.5 million tonnes-per-year Louisiana LNG development in 2025, with total forecast capital expenditure for the LNG project, pipeline and management reserve at $17.5 billion. The company said then the site was fully permitted for expansion to 27.6 million tonnes per year.
For Westcott, the next test is whether “strong interest” becomes signed offtake before investor patience thins. Scarborough, Woodside’s nearer-term Australian growth project, is 96% complete and still aiming for first LNG cargo in the fourth quarter of 2026, giving the company one cleaner milestone while Louisiana negotiations grind on. Business Wire
