Australia's energy sector is on the brink of a monumental shift, with Woodside Energy WDS and Santos Ltd. SSLZY exploring a merger. This potential unification signals a significant phase of consolidation in the global oil and gas industry.
This potential merger, if it goes ahead, would create an A$80 billion ($52 billion) oil and gas giant, reported Reuters.
Perth-based Woodside, the larger of the two, has disclosed that these merger talks are still in their infancy, and no conclusive agreement has been reached.
With a market capitalization of A$56.91 billion, Woodside dwarfs Santos' A$22.1 billion. However, both companies have faced their share of challenges, including a decline in their share prices amidst increasing pressures for decarbonization, added the report.
This potential merger would not only create a dominant force in the LNG market but also position the combined entity to better negotiate with buyers and optimize its LNG operations.
This move by Woodside and Santos mirrors the industry's broader push for consolidation to achieve economies of scale and prepare for the energy transition.
Related: Oil Majors To Consolidate: Watch For Further M&A Activity Across Sector In 2024
Price Action: WDS shares are trading lower by 0.31% at $19.16 on the last check Thursday.
Disclaimer: This content was partially produced with the help of AI tools and was Reviewed And Published By Benzinga Editors.
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