The tycoon, whose fishing and oil services group is based in the city, wants to raise Union Terrace Gardens to street level and create a 2ha piazza-style space to stage public events.
A feasibility study, financed by Scottish Enterprise, was launched last week and the results are due to be delivered in March.
Several attempts to revitalise the underused sunken gardens have failed in the past because of a lack of funding, including a scheme proposed by Grampian Enterprise in the early 1990s when Wood was chairman.
"That has always bothered me," he admitted. "Added to this is my conviction that the North Sea oil era, certainly the most economically rewarding in our city's history, should contribute to some major transformational change in the city's fabric.
"The new city heart should be an open leisure and recreational area with significant green landscaping, water features and year-round cultural activities."
Several conditions are attached to the proposed donation, including a demand that the new square cover the whole site and that major public finding is made available in addition to the offer.
Aberdeen City Council leader Kate Dean said Wood's proposals are of "national and regional significance" and open up an exciting opportunity for the city.
But the scheme puts in doubt plans for a £13 million arts centre in the gardens, which already has planning permission in place.