Woodside, Santos confirm merger talks to create $52bn energy giant

The potential deal, if executed, would create the biggest liquefied natural gas (LNG) producer in Australia and the second largest exporter of the fuel in the world

Australian petroleum exploration and production company Woodside Energy confirmed that it has entered into discussions regarding a potential merger with domestic peer Santos.

The potential deal, if it advances, will create an A$80bn ($52bn) oil and gas giant. The market capitalisation of Woodside and Santos are A$56.91bn and A$22.1bn, respectively.

The deal would also create the biggest liquefied natural gas (LNG) producer in Australia and the second largest exporter of the fuel in the world, reported Reuters.

In a statement, Woodside said: “Discussions remain confidential and incomplete, and there is no certainty that the discussions will lead to a transaction.

“As a global energy company, Woodside continuously assesses a range of opportunities to create and deliver value for shareholders.

“Woodside will continue to update the market in accordance with its continuous disclosure obligations.”

Santos also confirmed the talks in a separate statement emphasising that there is no agreement between the parties and there is no certainty that the discussions will eventuate into any transaction.

According to last year’s data, the two companies produced more than 260 million barrels of oil equivalent (BOE) in total and had proven plus probable reserves of 5.39 billion BOE.

The discussions come as the latest in the string of deals in the oil and gas industry.

Woodside completed the BHP deal less than 18 months ago, while Santos acquired Oil Search in December 2021.

In October this year, Chevron signed an all-stock deal worth $53bn to acquire rival American publicly listed oil and gas company Hess.

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