Woodside posts record revenue as gas prices soar

Australia’s largest oil and gas producer Woodside Energy more than quadrupled its revenue in the third quarter on the back of strong gas prices, as the company raised its production outlook.

Woodside said that its revenue increased to $5.9bn in the September quarter, up 70 per cent from the previous quarter and a significant jump from the $1.6bn that the Perth-based company reported in the same quarter last year.

The performance was driven by its merger this year with BHP’s petroleum assets division. Oil and gas companies have enjoyed a streak of record profits thanks to soaring energy prices caused by Russia’s invasion of Ukraine. Shares in Woodside gained as much as 7.2 per cent to A$34.89 ($21.81) on Thursday.

Woodside also struck a deal with Germany’s Uniper during the quarter to supply gas from 2023, with analysts predicting more deals to be announced.

“We expect the global LNG market to tighten as it heads into the Northern Hemisphere winter, and this should create opportunity for further third-party LNG sales by Woodside,” said Gordon Ramsay, an analyst with RBC.

Meg O’Neill, chief executive of Woodside, said that despite the strong performance, the outlook remained uncertain due to Opec’s cut to oil supplies and a global slowdown in economic growth. “It’s always a concern when the economy is soft,” she said.

O’Neill praised the Australian government’s adoption of new climate targets in August, which she said set out a clear pathway for companies such as Woodside. She described the measures as “pretty well aligned” with the company’s own decarbonisation plan.

She also said that Woodside was in talks with companies in Japan, South Korea and Singapore over offtake deals for a planned hydrogen energy facility in Perth that would stimulate investment in Western Australia’s renewables sector.

However, O’Neill warned of potential “repercussions” from an aggressive energy transition as Australia weans itself off coal power.

The state government of Victoria on Thursday unveiled a plan to re-establish a public body that would take stakes in renewable energy projects while pushing to accelerate the closure of coal-fired power stations.

“We are always cautious about government interventions,” said O’Neill.

Woodside has come under fire from climate activists in Australia. Peter Garrett, a former environment minister and the singer in rock band Midnight Oil, called on politicians to “stand up” to the company and stop new fossil fuel projects at a concert in Perth last month.

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