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Highlights

  • Woodside Energy shares rise 0.7% to $21.45 amid broader ASX 200 uptick.

  • Investors await Federal decision on $25 billion North West Shelf Project extension.

  • Approval could boost LNG exports, despite environmental concerns and Indigenous heritage debates.

Woodside Energy Group Ltd (ASX:WDS) shares gained traction in Tuesday morning trade, edging 0.7% higher to $21.45, outperforming the S&P/ASX 200 Index (ASX: XJO) which was up just 0.1% at the same time.

The modest gain comes as the market awaits a crucial decision from the Federal government on whether to approve the long-awaited extension of Woodside's North West Shelf Project — a move that could shape the future of Australian LNG exports and potentially provide a fresh catalyst for the energy giant’s stock.

The North West Shelf, located off the coast of Western Australia, is Australia’s largest and most mature oil and gas development. Since its inception over 40 years ago, it has attracted around $25 billion in investment, underpinning Australia’s status as a major liquefied natural gas (LNG) exporter.

The project encompasses a sprawling network of offshore platforms, subsea infrastructure, and an onshore processing facility. Its operations are considered vital for both domestic energy security and international export contracts, particularly in Asia.

In December, the project secured conditional approval from the Western Australian government, following a protracted six-year review process and opposition from environmental and Indigenous groups. The final hurdle now lies with the Federal government, which is expected to deliver its verdict within days, according to a report in The Australian Financial Review.

Adding to investor optimism are recent comments from Prime Minister Anthony Albanese, which market watchers have interpreted as signalling a likely federal green light. The Federal cabinet reportedly received the Department of Environment’s final recommendation last week, setting the stage for a decision that could unlock billions in revenue and secure hundreds of jobs.

While Brent crude prices remain soft, trading just below US$65 per barrel, the potential approval of the project extension is acting as a near-term driver for the Woodside share price.

However, critics continue to warn that expanding fossil fuel operations could run counter to Australia's net-zero emissions commitments.