(Bloomberg) – ExxonMobil is studying potential acquisition targets including Australia’s Woodside Energy Group, as the U.S. giant eyes options to deepen its presence in liquefied natural gas and Asian markets, according to people with knowledge of the matter.
Exxon has been holding early-stage discussions internally, said the people, who asked not to be named as they are not allowed to speak to the media. Woodside is one of several targets the company has been evaluating, the people said.
Woodside’s American depositary receipts rose as much as 14% in New York on Friday. The company had a market capitalization of around A$59 billion ($42 billion) at the close of trading in Sydney.
Deliberations are preliminary, and there is no certainty that they will lead to an offer, they said. Representatives for Exxon and Woodside declined to comment.
Exxoncompleted the acquisition of U.S. shale producer Pioneer Natural Resources Co.for $60 billion in 2024 and has since been looking for further opportunities. A move for Woodside, Australia’s top gas exporter, would expand its presence outside the US and push the company toward LNG, a sector in which it has lagged rivals like Shell Plc and TotalEnergies SE.
An LNG-focused deal has become a more serious priority since the start of the war in Iran in late-February, which effectively shut the Strait of Hormuz and choked a fifth of global supply—prompting buyers in Asia to look for alternative suppliers outside the Middle East, one of the people said.
Woodside is Australia’s largest LNG exporter, and is developing a project on the U.S. Gulf Coast which is set to come online by 2029. The company has also secured long-term sales agreements with leading buyers across Asia, including in South Korea and Japan, making it an attractive target for companies seeking a foothold in the LNG market.
Smaller Australian rival Santos Ltd. is one of few alternatives for would-be suitors, and has been the target of repeated bids. It was in talks last year with consortium led by a subsidiary of ADNOC but the deal unraveled.
A takeover offer, should it materialize, would be an early test for Liz Westcott, who took over as chief executive officer of Woodside this year after Meg O’Neill left to head bp Plc.
At home, Woodside is pushing forward with the Scarborough and Browse gas projects, which will help to lift the company’s LNG exports into the next decade. Woodside recentlyincreasedits stake in Browse in a move to help push forward the project.
Woodside and Exxon are already partners in the Bass Strait project, with Woodside taking over the operatorship last year.
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