Woodside, new Kitimat LNG partner, borrows $1 billion in new bonds

Woodside PetroleumWoodside Petroleum, the new partner with Chevron in the Kitimat LNG project is raising US$1 billion through the issue of corporate bonds into the U.S. market “to fund its capital and exploration expenditure program.”

A news release from Woodside says “the bonds will be issued by Woodside Finance Ltd, a wholly owned subsidiary of Woodside Petroleum Ltd, and will consist of US$1 billion of 10 year bonds with a coupon of 3.65 per cent. The bonds will be guaranteed by Woodside Petroleum Ltd and its wholly owned subsidiary, Woodside Energy Ltd.”

Bloomberg notes that Woodside paid $2.75 billion to Apache for its stakes in the Kitimat LNG and the Australian Wheatstone LNG project.

Woodside agreed in December to pay $2.75 billion to Apache Corp. for stakes in two natural gas projects, and it expects to spend about $6.2 billion in 2015.

Even after its agreement with Apache, Woodside has a strong balance sheet that may allow the company to make another acquisition and take advantage of low crude oil prices, according to a Feb. 18 report from Goldman Sachs Group Inc. Woodside has $6.8 billion in cash and available debt facilities, the energy producer said in a presentation that same day.

Woodside said last week that full-year net income rose 38 percent to $2.41 billion, helped by its Pluto project. Brent crude oil prices have tumbled 44 percent over the past 12 months.

In January, Australian Mining reported that Woodside had reached an “non-binding contract… ¬†as an agreement between Woodside Petroleum and Adani Enterprises to cooperate in developing commercial initiatives for long-term supply of gas to the Indian market.”