Woodside Energy (ASX: WDS) Signs 9-Year Turkey Deal: Time to Buy or Stay Away?

Woodside Energy Turkey Contract: Nine Years of LNG Sales

Woodside Energy (ASX: WDS) just locked in its first long-term gas deal with Turkey. The company signed a binding agreement with Turkish state-owned energy company BOTAŞ to supply liquefied natural gas (LNG) for up to nine years, starting in 2030. This deal converts a previously signed Heads of Agreement (HOA) into a binding Sale and Purchase Agreement (SPA), giving Woodside more predictable future revenue. For investors watching Australia’s biggest oil and gas company, the big question is simple: Does this contract, plus a dividend yield near 7%, make the stock worth buying today?

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Turkey Deal Brings Nine Years of Guaranteed Sales

Under the agreement, Woodside Energy will deliver about 0.5 million tonnes of LNG each year to BOTAŞ. This represents a total of approximately 5.8 billion cubic meters of natural gas equivalent over the nine-year term. The gas will be sourced from Woodside’s global portfolio, primarily supported by volumes from the Louisiana LNG project in the U.S.

This deal matters for two reasons. First, it gives Woodside a locked-in customer before the Louisiana plant even starts producing. That reduces risk for investors. Second, Turkey needs the supply. After Russia cut gas flows to Europe, Turkey has been scrambling to find new energy partners.

Louisiana LNG Powers Woodside’s Growth Story

The Turkey contract shows why Louisiana LNG matters to Woodside’s future. This US$17.5 billion project is the largest foreign investment in Louisiana’s history. Construction crews are on site, with first gas expected in 2029.

When fully built, Louisiana LNG will produce 16.5 million tonnes of gas per year. The project has permits to expand further. For Woodside Energy, this means the company could supply over 5% of global LNG by the 2030s. That would transform it into a true global energy powerhouse.

The Turkey deal proves Woodside Energy can sign customers ahead of production. If more contracts follow, it would reduce project risk and support the share price.

The Investor’s Takeaway

Woodside Energy offers something rare: a trailing dividend yield of approximately 7% (fully franked for Australian taxpayers), a price-to-earnings ratio around 11x, and real growth ahead. Broker Morgans has a buy rating with an A$30.60 price target, implying more than 30% upside from current levels. The broker likes that Woodside’s major projects are running on time and on budget.

But there are risks. CEO Meg O’Neill left in December to run BP. Liz Westcott stepped in as acting boss while the board finds a replacement. Leadership changes during big projects can create uncertainty.

The LNG market is another concern. Many new projects are coming online globally. If supply grows faster than demand, gas prices could fall and squeeze Woodside’s profits. Still, the stock has dropped about 6% this year despite good project news. That suggests some risk is already priced in.

Bottom line: Income investors will like the near 7% yield and growing contract book. Growth investors should watch whether more deals follow Turkey. At today’s prices, Woodside looks reasonably valued, but keep an eye on the CEO search and LNG market before buying heavily.