Woodside Energy Group Ltd. (ASX:WDS) could land a $1 billion windfall after putting two major West Australian oil and gas facilities on the market, signalling it will sever ties with several high-profile BHP-owned assets picked up from its $40 billion merger deal with the mining giant. The energy producer will field offers for its Pyrenees and Macedon oil and gas projects in WA's Carnarvon Basin. The latter is a major supplier to the state's domestic gas industry.

Woodside has hired Morgan Stanley as its exclusive financial adviser on the sale, in a deal which sources said could be worth up to $1 billion. It will look to sell all of its stakes in the two projects - a 71.4% interest in the Macedon field and a 62% share of Pyrenees - along with operator status. The assets have sustained production into the mid-2030s, although Woodside took a $68 million writedown on Pyrenees at its results this week.

Expected buyers are likely to include Santos Limited (ASX:STO), which owns 28.6% stakes in both of the facilities, along with Japan's Inpex, which has a smaller 9.4% share of Pyrenees. WA player Beach Energy Limited (ASX:BPT) may also consider an offer, sources said. "Macedon and Pyrenees are well-understood, mature and cash-generative assets with proved and probable reserves of 75 million barrels of oil equivalent net to Woodside's share," the flyer said.

The mooted sale may spark concern among WA industry, given tight supplies of gas in the domestic market and contract prices above the $12 per gigajoule price cap in place on the east coast. Wesfarmers has called for "urgent action" to boost domestic gas supply by insisting volumes are brought to market "without delay". Woodside notes Macedon is "strategically important" to energy supply in WA, supporting strong domestic gas supply for the market.