Woodside Energy Group H1 Earnings Call Highlights

Key Points

• Strong first-half performance: Woodside reported $1.3 billion in underlying net profit, $4.6 billion in EBITDA and $3 billion in operating cash flow, while declaring a fully franked interim dividend of $0.57 per share.
• Major projects remain on track: Scarborough reached 98% completion and is targeted for first LNG in the fourth quarter of 2026, while Trion and Louisiana LNG remain on schedule for 2028 and 2029 milestones, respectively. Woodside is also seeking additional Louisiana LNG partners to reduce its 57% capital exposure.
• Sharper focus on returns and costs: The company launched a program targeting $350 million in annual structural savings from 2028 and is reviewing Beaumont New Ammonia. It also abandoned its previous $5 billion new-energy investment target and retired its Scope 3 investment and emissions-abatement targets, while retaining its 2030 Scope 1 and 2 reduction goal.

Woodside Energy Group NYSE: WDS reported first-half 2026 production of 86.5 million barrels of oil equivalent and underlying net profit after tax of $1.3 billion, as the company advanced its Scarborough, Trion and Louisiana LNG projects while outlining a new cost-reduction program and a more selective approach to new-energy investments.

Chief Executive Officer Liz Westcott, delivering her first results presentation as CEO, said Woodside generated $4.6 billion in EBITDA, $3 billion in operating cash flow and $352 million in free cash flow during the half. The board declared a fully franked interim dividend of $0.57 per share, at the top end of the company’s targeted payout range.

Westcott said Woodside’s results were supported by reliable operations despite cyclone-related production effects and a planned turnaround at Pluto. The company recorded one high-consequence injury during the period, while reporting no Tier 1 or Tier 2 process-safety events.

Projects Progress Toward Production

Woodside said its Scarborough Energy project was 98% complete at the end of the half and remains on schedule and budget for its first LNG cargo in the fourth quarter of 2026. Subsequent to the reporting period, the project’s floating production unit reached ready-for-startup status and achieved first gas.

At Pluto Train 2, Woodside completed mechanical runs on three of six liquefaction compressors. The company is continuing commissioning work, including bringing wells online, pressurizing the trunk line and introducing gas into onshore facilities.

The Trion oil project offshore Mexico was 64% complete and remains targeted for first oil in 2028. Engineering for the floating storage and offloading facility is progressing, while subsea installation is scheduled to begin in the third quarter of 2026.

Louisiana LNG was 28% complete at the end of the half. Train 1 was 35% complete, with the first mechanical equipment installed, while construction also began on Train 2 structural steel. Westcott said the project remains on schedule and budget. She added that Bechtel’s steel fabrication activities in the Middle East had not been disrupted, though the contractor was using alternative supply routes and had other fabrication options.

Woodside continues to seek additional Louisiana LNG partners and LNG offtake agreements. Westcott said the company has received strong interest but is taking a patient approach to securing “high-quality partners” for the long-term investment. Stonepeak and Williams have already joined the project, reducing Woodside’s capital exposure to 57% of the total investment, or $9.9 billion, according to the company.

Portfolio Changes and Operating Performance

Woodside exercised a preemption right during the half that will increase its equity interest in Browse upon completion. Westcott said the company’s ownership in both the Browse resource and North West Shelf onshore infrastructure supports an integrated development concept, though Browse remains in pre-FEED and Woodside did not provide a timeline for a final investment decision or an estimated capital cost.

In July, Woodside assumed operatorship of Gippsland Basin assets in Australia. The company is evaluating a potential four-well development that could unlock up to 200 petajoules of Bass Strait gas. Westcott said progress will depend on the final details of Australia’s proposed Domestic Gas Reservation Scheme, including the regulatory and pricing framework.

Internationally, Sangomar in Senegal produced 15 million barrels of oil equivalent on a Woodside-share basis, with 99.5% reliability. The asset has generated $3.8 billion of EBITDA for Woodside since startup. The company is discussing a potential second phase with Petrosen and the Senegalese government that could involve six to eight wells to backfill existing facilities. Woodside said it does not expect an expansion of the field’s nameplate production capacity.

At Beaumont New Ammonia, Woodside took operational control in March and has begun delivering cargoes to domestic and international markets. Production was constrained by third-party feedstock availability, an issue the company expects to continue through 2027.

Cost Program and New-Energy Review

Westcott announced a structural cost-reduction target of $350 million annually from 2028. The initiative will cover operating costs, corporate overhead and some sustaining capital expenditure, with Woodside seeking to simplify the organization, accelerate decision-making and allocate resources more effectively.

The company is also reviewing its capital strategy and intends to introduce a single investment framework under which all investments compete for capital. Chief Financial Officer Graham Tiver said Woodside plans to provide more detail at its Capital Markets Day in November, including information on capital allocation and capital management.

As part of its sharpened focus on returns, Woodside launched a strategic review of Beaumont New Ammonia. Westcott said the asset was acquired when there was greater visibility into a developing lower-carbon ammonia market and related regulatory frameworks. The company will consider all options for the asset, with no predetermined outcome.

Woodside also retired its Scope 3 investment and emissions-abatement targets, including its previous ambition to spend $5 billion on new-energy projects by 2030. Westcott said markets for hydrogen, ammonia and carbon capture and storage have developed more slowly than anticipated, and the company no longer sees a path to commercially attractive projects sufficient to meet the target. Its 2030 target for a 30% reduction in net equity Scope 1 and 2 emissions remains unchanged.

Balance Sheet and Market Outlook

Tiver said Woodside ended the half with $8.2 billion in cash and undrawn facilities. Gearing was 20.6%, slightly above the company’s 10% to 20% target range, reflecting lease liabilities, hedge settlements and trade receivables. He said Woodside expects gearing to return below 20% by year-end, supported by stronger second-half production, pricing, cash flows related to the Wheatstone-North West Shelf asset swap, and the timing of hedge settlements.

Woodside realized an average price of $74 per barrel of oil equivalent during the period. The company said around 75% of its LNG volumes are contracted through 2028, while its marketing and trading business expects more than $100 million of value in the second half from trades executed during the first half.

About Woodside Energy Group (NYSE:WDS)

Woodside Energy Group NYSE: WDS is an Australia-based energy company focused on the exploration, development, production and marketing of oil and natural gas, with a strong emphasis on liquefied natural gas (LNG). The company's activities span the upstream value chain, including exploration and appraisal of hydrocarbon resources, development and operation of production facilities, and the sale and delivery of hydrocarbons to global customers.

Woodside's operations center on conventional oil and gas projects and large-scale LNG processing and export, supported by project management, engineering and commercial trading capabilities.

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