Woodside Petroleum expects to hike its capital spending by about a third to $4 billion in 2022, as it advances oil and gas growth projects in Western Australia and Senegal, as well as steps up efforts to start producing hydrogen.
After booking record quarterly sales revenue on soaring LNG prices, chief executive Meg O’Neill said on Thursday the company was positioned for a big year aiming to seal a merger with the petroleum arm of BHP Group by June and progress the Scarborough gas field development and Pluto LNG plant expansion.
“It’s important to get out of the blocks fast,” O’Neill said, two months after hitting the final go-ahead for the $12 billion Scarborough and Pluto LNG expansion.
Woodside is also focused on its Sangomar oil project in Senegal, which O’Neill said was on track to start producing in 2023.
Woodside Shifts to New Energy
The company gave a clearer picture in its December quarterly report on the timing of three hydrogen projects in Oklahoma, Western Australia and Tasmania, all part of its plan to invest $5 billion in “new energy” between now and 2030.
“We need to start picking up a bit of pace there,” O’Neill said.
Woodside aims to make a final investment decision on the first stage of the Oklahoma project – which would produce 32,850 tonnes a year – in the second half of 2022, and aims to reach a final go-ahead for the Tasmania project in 2023.
The Tasmania project will need to line up export customers before the company makes a final decision, O’Neill said.
Total investment spending in 2022 is expected to be between $3.8 billion and $4.2 billion, versus around $3 billion in 2021.
Woodside’s sales jumped to $2.85 billion for the fourth quarter that ended December 31, up from $920 million a year ago, beating a Citi estimate of $1.97 billion.
Woodside estimated 2022 production would rise about 4% to between 92 million barrels of oil equivalent (MMboe) and 98 MMboe, excluding any BHP contribution.
- Reuters with additional editing by Jim Pollard
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