Woodside Petroleum (ASX:WPL) declared it has discovered more gas offshore Western Australia. The latest gas discovery could put Pluto's fast expansion plans back on track.

Analysts had predicted the company would fail its target schedule of confirming the second-train expansion of the Pluto liquefied natural gas (LNG) project by the end of 2010, as inconsistent exploration results raised questions it would find the necessary gas reserves to support the expansion.

"Initial analysis of drilling fluids suggests the gas could be comparatively liquids rich, but this requires confirmation by further analysis," Woodside said of its Alaric-1 well, which is more than 400 kilometres out to sea.

The company disclosed the well intersected a 185-metre gas column and it is still deepening the search to penetrate the full column.

The company will proceed to carry out further testing to verify the full depth of the gas column and the quality of the gas.

Woodside is hurrying to complete Pluto's first train, which is estimated to cost A13 billion and slated to commence LNG production of 4.3 million tonnes per annum (mtpa) in late 2010.

Adding a second train with an output of about 4 mtpa would greatly enhance Pluto's economics and permit Woodside to roll over its current workforce, which is predicted to be in shortage over the coming years amid a raft of other LNG projects.

Shares in Woodside, which is expected to report first-half earnings on Wednesday, climbed 3.1 per cent to $42.78 by early afternoon, compared with 0.8 per cent slump in the benchmark S&P/ASX 200 index.