Sydney Morning Herald: Woodside Faces Costs Battle on WA Gas Projects

Woodside Petroleum faces a battle to rein in costs on the Browse and Wheatstone liquefied natural gas projects in Western Australia, piling pressure on the energy producer as it attempts to resurrect a $11.6 billion takeover of Oil Search amid low oil prices.

Woodside's ability to reduce the estimated $40 billion budget on the Browse floating LNG development has been called into question by Macquarie analysts following a field trip to Karratha​ in the Pilbara last week.

Woodside boss Peter Coleman said in October that the Browse partners had already reduced the costs to develop the three offshore gas fields in the Browse Basin, and now had "a tailwind of opportunity" to cut costs downstream.

But Macquarie on Tuesday said its capacity to cut costs was dwindling. MORE