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Woodside Energy Group (ASX: WDS) (NYSE: WDS) (LSE: WDS): Woodside today reported record production of 193.9 million barrels of oil equivalent (MMboe), or 530 Mboe/day, for the full year 2024. The result was underpinned by outstanding early production performance at Sangomar and world-class reliability at operated LNG assets. Net profit after tax (NPAT) for 2024 was 115% higher year-on-year at $3,573 million. Underlying NPAT decreased 13% from the previous year to $2,880 million, primarily due to lower realised oil and gas prices.1 The Directors have determined a final dividend of US 53 cents per share (cps), which brings the full-year fully franked dividend to US 122 cps and maintains payout ratio at the top of the target range at 80%. The value of the full-year dividend is $2,316 million. Woodside CEO Meg O’Neill said Woodside is set to become a highly cash generative business. “Our proven track record of operational excellence, disciplined investment decisions and world-class project execution is delivering near-term rewards for our shareholders while laying the foundations for a new chapter of value creation. “In 2024, the record annual production was at the top end of the full-year guidance range, underpinned by consistently strong 98% reliability at our operated LNG facilities. “Unit production cost of $8.1/boe was down 2% from 2023, underlining operational discipline and the resilience of the base business in a period of inflationary pressures. Woodside’s operating cash flow was strong at $5.8 billion and the cash margin was 82%, up from 80% in 2023. “Sangomar ramped up to nameplate capacity within nine weeks of its June 2024 startup, achieving 94% reliability in the fourth quarter. Sangomar’s contribution of 12.9 million boe of sales generated around $950 million in revenue, demonstrating the project’s value. “Excellent progress was made on Woodside’s major growth projects, with the Scarborough Energy Project now 80% complete and on track for first LNG cargo in 2026. “LNG Japan acquired a 10% non-operating participating interest in the Scarborough Joint Venture (SJV) for $910 million and JERA acquired a 15.1% non-operating participating interest in the SJV for $1.4 billion. These transactions reflect the long-term value that premium LNG customers in Japan are placing on energy security. “During the year Woodside signed three agreements for the long-term sale of LNG to customers in Japan, Korea and Taiwan. These agreements demonstrate the value that regional energy customers place on security and certainty of supply, and the ongoing role of LNG in balancing our customers’ energy security and decarbonisation needs. “Woodside simplified its Australian portfolio and consolidated its focus on operated LNG assets by entering into an asset swap agreement with Chevron. The asset swap provides Woodside with the opportunity to realign its Australian interests to provide greater commercial certainty and enhance development prospects. “In Mexico, the Trion Project is more than 20% complete and targeted for first oil in 2028. “In 2024 we made two acquisitions that will deliver long-term profitability and cash flow for Woodside, with investments in Louisiana LNG and Beaumont New Ammonia. “Louisiana LNG is an advantaged US Gulf Coast project, fully permitted for 27.6 Mtpa of LNG production, with a competitively priced EPC contract with Bechtel and with civil works largely de-risked. This compelling opportunity is attracting interest from high-quality partners, and we are progressing towards readiness for a final investment decision from the first quarter of 2025. “The Beaumont New Ammonia Project demonstrates Woodside’s disciplined investment in assets which can generate sustained shareholder returns. The project is set to provide strong cash flows at current ammonia pricing and positions Woodside to be an early mover in the growing global market for premium lower-carbon ammonia once the associated carbon capture and storage (CCS) facility comes online. “The Beaumont acquisition also represents material progress towards achieving our Scope 3 targets, with the potential to abate up to 1.6 million tonnes per annum carbon dioxide equivalent of customer emissions when CCS is online. With construction at Beaumont now 83% complete, we are targeting the startup of ammonia production in the second half of this year and lower-carbon ammonia production in the second half of 2026. “As reported in the 2024 Climate Update released today, we have continued to deliver on our commitments as we pursue a climate strategy for all our shareholders and which balances ambition with financial discipline and achievability. This year Woodside further reduced net equity Scope 1 and 2 greenhouse gas emissions to 14% below our starting base and we remain on track to meet 2025 and 2030 targets. “Woodside begins 2025 with a strong balance sheet, a resilient and high-performing base business and an attractive portfolio of projects which position us to deliver value-accretive growth and shareholder returns.” Business highlights Strategic achievements Acquisition of Tellurian and Driftwood LNG (renamed Louisiana LNG), positioning Woodside as a global LNG powerhouse and significantly increasing long-term cash generation potential. Acquisition of Beaumont New Ammonia, a compelling new energy investment targeting first ammonia production in the second half of 2025 and lower-carbon ammonia production in the second half of 2026 that will provide Woodside’s entry into the growing global lower-carbon ammonia market.3 Completed sell-down of SJV to high-quality partners, confirming project value, while strengthening the balance sheet with $2.3 billion cash proceeds. Signed long-term sales agreements for more than 15 Mt LNG to Asian buyers in 2024. Simplification of Australian portfolio through an asset swap.4 Prioritising delivery of Beaumont New Ammonia within New Energy business. Operations and projects Outstanding Sangomar performance underpins record annual production of 194 MMboe.5 World-class operated LNG reliability of 98% maintained in 2024. Net profit after tax of $3.6 billion, total full-year dividend declared of $2.3 billion, US 122 cps fully franked and at top end of the target payout range. Execution of major growth projects; Scarborough Energy Project 80% complete 6, Trion more than 20% complete. Unit production cost of $8.1 per boe, reduced by 2% from previous year despite inflationary environment. On track to meet Scope 1 and 2 emissions reduction targets; material progress made toward Scope 3 investment and abatement targets.7,8 |
