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Woodside Energy has agreed to buy struggling US liquefied natural gas developer Tellurian in a $1.2bn deal that the Australian company said would turn it into a “global LNG powerhouse”.

The transaction, announced by the companies on Sunday, draws a line under a long-running saga surrounding Tellurian, which ousted its chair in December amid repeated struggles to get its $25bn Driftwood export project in Louisiana off the ground.

“Despite our recent progress, we’ve been clear that the company’s situation necessitated an exploration of all possible alternatives, including a potential sale,” wrote Tellurian executive chair Martin Houston in a letter to shareholders. “Ultimately, we decided the attractive offer in hand outweighed the risks and uncertainty associated with going it alone.”

Tellurian was founded in 2016 by Houston, a former BG Group executive, and US LNG pioneer Charif Souki, with the aim of developing the Driftwood project on a 1,200-acre site along the Calcasieu river. If completed, it would be one of the country’s largest export terminals.

But the project has faced repeated setbacks, losing key buyers and struggling to raise funds despite a surge in demand for US gas since Russia’s invasion of Ukraine.

Souki, credited with kick-starting the US LNG export industry at his former company Cheniere, was ousted as executive chair at Tellurian in December as its struggles intensified.

The company’s travails have caused its market value to collapse from a high of almost $3bn in 2017 to less than $500mn on Friday. The sale price, which includes $900mn in cash plus the company’s debt, is a 75 per cent premium to its most recent close.

For Woodside, Australia’s biggest oil and gas developer, the deal gives it a better foothold in the booming US LNG export industry at a time when demand for the super-chilled fuel is set to grow rapidly.

“The acquisition of Tellurian and its Driftwood LNG development opportunity positions Woodside to be a global LNG powerhouse,” said Woodside chief executive Meg O’Neill.

Woodside, which traces its roots to the 1950s and doubled in size in 2022 when it merged with BHP’s oil and gas division, has been on the hunt for acquisitions to bolster its growth prospects.

It held talks with local rival Santos this year for a $52bn deal that would have created a “national champion”, but it fell apart after the two companies failed to agree terms.

Saul Kavonic, an analyst with MST Marquee, said Woodside had acquired Tellurian at a “bargain price” close to book value and would be better set to develop the project than the existing management due to its existing relationships in the LNG sector.

He added Woodside would look to sell stakes in the project to partners in time, with Japanese, Middle Eastern and US investors potentially interested once Woodside takes control of the assets.

“This is the right kind of M&A Woodside should be pursuing,” he said, adding that Woodside would still need to detail the impact of developing Driftwood on its dividend policy to investors.

The Perth-based company already has a burgeoning presence in the US market, where it is the majority owner of the Shenzi field, off the coast of Louisiana.

The Tellurian takeover is the latest example of consolidation in the global energy sector as large groups such as Chevron and ExxonMobil have taken out smaller rivals to boost their growth prospects.

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The stories that matter on money and politics in the race for the White House

US President Joe Biden has abandoned his re-election bid following overwhelming pressure from fellow Democrats and endorsed his vice-president Kamala Harris to succeed him, saying it was “in the best interest of my party and the country for me to stand down”.

The president announced his decision to quit the race in a letter published to social media on Sunday, throwing this year’s White House contest into turmoil with less than four months to go until voters in the world’s biggest economy elect their new leader on November 5.

“It has been the greatest honour of my life to serve as your president,” Biden said. “And while it has been my intention to seek re-election, I believe it is in the best interest of my party and the country for me to stand down and to focus solely on fulfilling my duties as president for the remainder of my term.”

The president added that he would speak to the country “later this week in more detail about my decision”. Biden has not been seen in public since Wednesday, when he was diagnosed with Covid-19.

He said in a second social media post that he would “offer my full support and endorsement for Kamala to be the nominee of our party this year”.

“Democrats — it’s time to come together and beat Trump,” Biden added. “Let’s do this.”

Harris later issued her own statement saying she was “honoured” to have Biden’s endorsement, adding: “My intention is to earn and win this nomination.

“I will do everything in my power to unite the Democratic party — and unite our nation — to defeat Donald Trump,” she added.

Harris, who would become the country’s first female president should she win, quickly picked up the backing of several influential Democrats.

Former president Bill Clinton and the party’s 2016 nominee Hillary Clinton issued a joint statement saying they were “honoured to join the president in endorsing vice-president Harris”, adding they would “do whatever we can to support her”.

Gavin Newsom, the governor of California, and Michigan governor Gretchen Whitmer — both considered possible presidential candidates themselves — were also expected to endorse Harris, said three prominent Democratic party donors and operatives with direct knowledge of the matter. Representatives for Newsom and Whitmer did not immediately respond to requests for comment.

Barack Obama, who selected Biden as his own vice-president in 2008, issued a statement calling him “one of America’s most consequential presidents, as well as a dear friend and partner”. Obama stopped short of endorsing a successor, but said he had “extraordinary confidence that the leaders of our party will be able to create a process from which an outstanding nominee emerges”.

Democrats will need to rally behind a new presidential candidate in the weeks before the party’s official nominating convention on August 19. Democratic National Committee chair Jaime Harrison on Sunday said the party would “in short order” lay out the “next steps and the path forward for the nomination process”.

Biden’s unprecedented decision will reverberate across the globe, injecting new uncertainty into US policy at a moment of acute geopolitical tension, from the Indo-Pacific to Ukraine to the Middle East.

Biden’s announcement follows more than three weeks of wrenching debate among Democrats about his candidacy after a disastrous debate performance against Donald Trump reignited concerns about the 81-year-old’s mental acuity and damaged his standing among American voters. An Associated Press poll out last week found nearly two-thirds of Democratic voters said Biden should drop out of the race.

Trump had opened up a significant polling lead over Biden in national and swing state surveys in recent weeks. In a statement posted to his Truth Social platform on Sunday he said Biden was “not fit to run for president” and “certainly not fit to serve”.

Republican Speaker of the House Mike Johnson issued a statement calling for Biden’s immediate resignation from the presidency.

“If Joe Biden is not fit to run for president, he is not fit to serve as president,” Johnson said.

But Biden’s decision earned him immediate praise from several top Democrats, including Senate leader Chuck Schumer, who described him as a “great president . . . a great legislative leader” and “a truly amazing human being”.

“His decision of course was not easy, but he once again put his country, his party, and our future first.”

Hakeem Jeffries, the Democratic House leader, said the country would be “forever grateful” to Biden for his leadership.

The decision by the 46th American president not to seek a second term marks the beginning of the end of one of Washington’s most storied political careers. Biden entered the Senate in 1973, became vice-president to Obama in 2009, and gained the Oval Office in 2020 in an era marked by a global pandemic, economic recovery, inflation and war.

WASHINGTON — Some Republicans reacted immediately to President Joe Biden’s announcement that he won’t seek re-election in November by demanding that he resign the presidency as well.

“If Joe Biden is not fit to run for President, he is not fit to serve as President. He must resign the office immediately. November 5 cannot arrive soon enough,” House Speaker Mike Johnson, R-La., said in a statement shortly after Biden revealed his decision.

New York Rep. Elise Stefanik, the conference chair and fourth-ranking House Republican, added: “If Joe Biden can’t run for re-election, he is unable and unfit to serve as President of the United States. He must immediately resign.”

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It was a widespread response within the Republican Party, with multiple others reacting similarly, including Rep. Pat Fallon, R-Texas: