Energy giant Woodside said Wednesday it was raising Aus$2.5 billion (US$1.97 billion) to fund the purchase of ExxonMobil's stake in an Australian offshore gas field, as it seeks to benefit from an expected jump in global LNG demand.
The Australian-listed firm's plans to increase its interest in the Scarborough gas field off Western Australia came as rising prices and low production costs helped it post an 18 percent jump in net profit to US$1.02 billion for 2017.
Under the agreement with ExxonMobil, Woodside would acquire the US oil and gas giant's 50 percent holding in Scarborough to take its overall interest to 75 percent. The world's biggest miner BHP owns the remaining 25 percent.
Woodside said the acquisition, set to be completed by the end of March, would cost about US$744 million, with the remainder of the equity raised to fund the development of Scarborough and other projects such as an oilfield in Senegal.
"The acquisition of the additional interest in Scarborough provides greater alignment, control and certainty over a low-cost, high-value opportunity ahead of a global LNG supply gap," Woodside chief Peter Coleman said in a statement.
The company said it expected global liquefied natural gas demand to increase over the next few years as the energy mix shifts to gas.
Economic growth and public policy changes were underpinning Asian LNG demand growth, Woodside added in a briefing pack to investors, with Chinese demand forecast to grow at a seven percent compound annual rate to 2025.
Shares in Woodside went into a trading halt Wednesday ahead of the announcement. They last traded at Aus$31.08.