Woodside Leads Bids for Apache Assets

Australia’s Woodside Petroleum is said to have made a multi-billion-dollar offer for Apache Energy’s interest in the Wheatstone LNG project under construction in Western Australia, along with other assets in Western Australia and the proposed Kitimat LNG development in Canada.

Falling oil prices have seen other bidders pulling out, and The Australian reports sources indicating a decision on the Woodside offer could be made before Christmas. Woodside is believed to have offered about $1.8 billion (A$2.17 billion) for Apache’s 13 per cent stake in Wheatstone.

Wheatstone, scheduled for production in 2018, was originally budgeted to cost around A$29 billion, and this figure hasn’t been officially revised despite cost blowouts in other Australian projects. Sources close to the negotiations have suggested that Wheatstone capex might have increased by about 15 percent, reports The Australian, and this could affect the current negotiations with Apache.
 
Woodside’s offer is believed to have beaten rival bids from Harbour Energy and Singapore’s Pavilion Energy. 

Oil prices have fallen by over 40 percent since June. Woodside, however, has remained strong and appears to be seeking opportunities for growth in the weak market. The company may be looking for alternate assets as the future of Australia’s Browse joint venture is in doubt.

Apache has been under pressure from shareholders to focus on its North American assets.