Woodside CEO sees no need for M&A, plenty of growth in pipeline
SYDNEY – Woodside Petroleum CEO Peter Coleman said there's little need for more mergers and acquisitions by Australia's biggest independent oil and gas producer as it works on developing a handful of new projects at home and abroad.
The company, seen as short on growth, has had to rely on a few deals to build up reserves after being snubbed in late 2015 in an $8-billion bid for Oil Search and walking away from a $2.6-billion gas stake off Israel a year earlier.
"We're starting to get a pipeline of projects moving through," Coleman told Reuters after Woodside reported fourth-quarter revenue rose a better-than-expected 2% to $1-billion from the previous quarter thanks to higher oil prices.
The $34-billion Wheatstone liquefied natural gas (LNG) project off Western Australia, which Woodside bought into in 2015, is scheduled to start this year after six months of delays, followed by a second stage in 2018, Coleman said.
Wheatstone, operated by Chevron, will contribute more than 13-million barrels of oil equivalent to Woodside's annual output, when complete.
Woodside expects 2017 production to fall to 84-90 mmboe from 94.9 mmboe last year, in line with two analysts' forecasts, with Wheatstone's ramp-up not enough to offset a long agreed drop in the company's share of domestic gas from the North West Shelf from May.
Woodside's shares fell 1% on Thursday, but analysts attributed that to profit taking following a run-up over the past two months on the back of rising oil prices.
From 2019, Woodside plan to start producing from its Greater Enfield oil project in Australia.
"Do we need to buy something? No," Coleman said. "Woodside does not need to buy to grow."
Coleman also said he was anxious to get started on development "as soon as possible" on a promising oil venture off the coast of Senegal that it acquired from ConocoPhillips last October for $440-million.
The Senegal deal gave Woodside 35% of the SNE and FAN oil discoveries off the West African country, setting it up to start producing oil early in the next decade.
Woodside last year also bought half of BHP Billiton's stake in the undeveloped Scarborough offshore gas field assets in Western Australia.
It is drilling in Myanmar, too.
"With their level of activity in the past several year, Woodside certainly can't be accused of inertia," said RBC Capital Markets analyst Ben Wilson. "They have been positioning themselves for growth."
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation