Australia's Woodside, Santos in talks for $53-B oil-gas merger
(Reuters) - Australia energy companies Woodside and Santos Ltd said late on Thursday that they are in preliminary merger talks, in what could be the latest big deal in a wave of global consolidation the in oil and gas sector.
A potential combination of the companies, which together have a market value of about $52 billion, comes amid challenges faced by both in their domestic projects from Indigenous people as well as rising pressures of decarbonization.
Both companies have seen their share performance lag global peers.
Woodside in October cut its 2023 production outlook and missed third-quarter revenue estimates, while it was ordered by the Australian federal court to seek new approval to conduct seismic blasting under the seabed for its $12 billion Scarborough gas project after a legal challenge by an Indigenous woman.
Santos is contending with legal challenges from a traditional land owner from the Tiwi Islands on undersea pipeline works for its $3.6 billion Barossa gas project and has forecast lower output in 2024 as its Bayu-Undan gas field reached the end of its life and its West Australian offshore field's output declined.