New York-based alternative investment firm Stonepeak has signed an agreement to take a 40% stake in Louisiana LNG Infrastructure, a liquefied natural gas production and export terminal in Calcasieu Parish, Louisiana, owned by Woodside Energy Group.

Australian Securities Exchange ( ASX )-listed Woodside says the transaction significantly reduces its capital expenditure profile and improves its readiness for a final investment decision ( FID ) on the project. Under the deal, Stonepeak will provide US$5.7 billion towards the expected capital expenditure for the foundation development of Louisiana LNG on an accelerated basis, contributing 75% of project capital expenditure for 2025 and 2026. This enhances the project economics and Woodside’s cash flow profile ahead of revenues from Woodside’s Scarborough Energy Project in Australia.

The project is located in the heart of the Gulf Coast LNG corridor with close proximity to natural gas resources and direct access to the US Gulf. It has a total permitted capacity of 27.6 million tonnes per annum.

Construction is currently underway, and the front-end engineering design has been completed. Bechtel is the engineering, procurement, and construction ( EPC ) contractor.

Woodside will continue to operate the project following the completion of the transaction, which is expected to close in the second quarter of 2025, subject to customary conditions and approvals, including FID.

“With the need to bring significant additional capacity online over the coming years, we have strong conviction in the critical role Louisiana LNG will play in the US LNG export market,” says James Wyper, senior managing director and head of US private equity at Stonepeak. “The project represents a compelling opportunity to invest in a newbuild LNG export facility nearing FID approval with an attractive risk-return profile and best-in-class partners in both Bechtel and Woodside to construct and operate the asset.”

More partners sought

Mizuho Bank, together with its affiliate Greenhill & Co, and Santander US Capital Markets acted as financial advisers to Stonepeak. Simpson Thacher & Bartlett served as transactional legal counsel, and Paul, Weiss, Rifkind, Wharton & Garrison as financing legal counsel to Stonepeak.

RBC Capital Markets and Evercore served as financial advisers to Woodside, while Norton Rose Fulbright acted as legal counsel to Woodside.

The project was initiated by US company Tellurian, which Woodside acquired last year. The Tellurian Driftwood LNG project was subsequently renamed Lousiana LNG.  

Woodside says it will continue advancing discussions with other potential partners, targeting an equity selldown of around 50% in the integrated project. "As we have demonstrated with our Scarborough and Pluto Train 2 Project in Australia, the addition of an infrastructure partner unlocks value and paves the way for other strategic equity partners,” says Woodside chief executive officer Meg O'Neill.

Stonepeak specializes in investing in infrastructure and other real assets, and has approximately US$72 billion of assets under management.