Woodside Energy Group Ltd · ASX:WDS
Woodside Energy — Woodside Petroleum — FY2020 Earnings Presentation
33 slides from Woodside Energy's earnings presentation, Feb 18, 2021
Slide 1: ASX Announcement: Woodside Full-Year 2020 Results
ASX Announcement Woodside Petroleum Ltd. ACN 004 898 962 Mia Yellagonga Thursday, 18 February 2021 11 Mount Street Perth WA 6000 ASX: WPL Australia OTC: WOPEY T +61 8 9348 4000 www.woodside.com.au WOODSIDE FULL-YEAR 2020 RESULTS Woodside delivered record full-year production of 100.3 million barrels
Slide 2: Financial headlines and key business activities
“Subsequent to the period, we embarked on a three-well drilling campaign offshore Myanmar. That program is continuing, although we are closely monitoring events in the country, while ensuring all our people are safe and well. “Our new energy businesses have also progressed, with our proposed H2TAS r
Slide 3: Conference call details and contacts
We recommend participants pre-register 5 to 10 minutes prior to the conference call via the following link: https://s1.c-conf.com/diamondpass/10011804-d8s73k.html Following pre-registration, participants will receive the teleconference details and a unique access passcode. The full-year results brie
Slide 4: Full-Year Results Briefing 2020
Slide 5: Disclaimer and important notice
Disclaimer and important notice Disclaimer and risks onshore gas projects the reference point is defined as the inlet to the downstream (onshore) • This presentation contains forward looking statements that are subject to risk factors associated processing facility. with oil and gas businesses. 3. W
Slide 6: Performance summary
OVERVIEW Performance summary Record annual production Low unit production cost Net profit after tax 100.3 $ 4.8 $ -4,028 per boe MMboe million 12% 16% Record annual sales volume Cash margin Underlying net profit after tax 106.8 78 % $ 447 MMboe million 10% 1% Full-Year 2020 Results Briefing 3
Slide 7: Operational highlights
OVERVIEW Operational highlights Best-ever safety performance High operated LNG reliability 97.6 % 25 1.80 1.64 0.88 1.60 20 1.29 1.32 1.40 15 1.20 4% 17 0.90 1.00 Total recordable 21 injury (TRI) rate 1 12 0.80 Protected against COVID-19 0 10 11 11 0.60 Employee TRI cases on 0.40 5 6 5 0.20 Woodside
Slide 8: Readying for Scarborough FID targeted in H2 2021
OVERVIEW Readying for Scarborough FID targeted in H2 2021 World-class ~20% increase in Commonwealth environmental resource1 offshore capacity2 approvals received 11.1 8.0 Production licences received Mtpa Tcf Participating interests aligned Globally Equity gas offtake competitive project3 contracted
Slide 9: Sangomar execution underway
OVERVIEW Sangomar execution underway Continued execution Limiting COVID-19 schedule impact 17 Subsea equipment Progress fabrication on schedule Implemented mitigations: % Prepared for development • Remote site inspections and factory drilling acceptance testing supervision complete at • Integration
Slide 10: NWS Project readying for third-party gas processing
OVERVIEW NWS Project readying for third-party gas processing Karratha Gas • Third-party gas processing Plant agreements executed for Pluto (3.0 Mt) and Waitsia Stage 2 (7.5 Mt) gas • Pluto-KGP Interconnector construction commenced Pluto LNG • Start-up targeted for 2022 Proposed Pluto • Executed agre
Slide 11: Outstanding drilling and completions performance
OVERVIEW Outstanding drilling and completions performance Julimar-Brunello Phase 2 Pyxis Hub 18 % 20 % • Low non-productive time (NPT) • World’s first dual zone • Woodside’s deepest water development well (985m) open hole gravel packs • No lost time due to cost saving cost saving • Outstanding HSE p
Slide 12: Clear emissions reduction targets
OVERVIEW Clear emissions reduction targets 2.2Mt 15 30 Over % % NET ZERO equity CO 2-e offset or below baseline below baseline aspiration by avoided since 2008 by 2025 by 2030 2050 or sooner DELIVERED NEAR-TERM MEDIUM-TERM LONG-TERM Full-Year 2020 Results Briefing 9
Slide 13: Reducing our footprint
OVERVIEW Reducing our footprint Delivering energy efficiency improvements Building a cost-effective offsets portfolio • Optimisation of KGP fuel operation improving fuel intensity 29 • Novel optimisation of FPSO gas compression to reduce flaring Planted since 2008 • Dual boil-off gas compressors at
Slide 14: Values-led organisation
OVERVIEW Values-led organisation Leading sustainability performance Reconciliation Stewardship Top 5% of Maintained Top 2% of 271 Completed Environment industry peers AAA leader industry peers 2016-2020 Company rating RAP Excellence Award Full-Year 2020 Results Briefing 11
Slide 15: Financial Update
FINANCIAL UPDATE Sherry Duhe Executive Vice President and CFO
Slide 16: Balance sheet discipline throughout the cycle
FINANCIAL UPDATE Balance sheet discipline throughout the cycle Operating cashflow Cash margin 3,600 1,849 Operating revenue $ $ 78 % million million 26% 44% 1% 24.4 Liquidity Gearing Dividend per share1 $ 6.7 % 38 US cps billion 4% 10% 58% 1. Full-year dividend consists of US 26 cps interim dividend
Slide 17: Net profit after tax reconciliation
FINANCIAL UPDATE Net profit after tax reconciliation 343 (1,929) 4,370 105 447 (4,028) 447 0 573 (4,878) (346) 3,923 (4,532) $ million 1,945 (82) 2019 2019 NPAT Sales revenue: Sales revenue: Impairment and Other Income tax and 2020 2020 NPAT Impairment and Other (post-tax) 2020 2020 underlying NPAT
Slide 18: Excellent operational cost performance
FINANCIAL UPDATE Excellent operational cost performance Unit production cost 600 5.7 6.0 UPC trend reflecting record annual 5.0 5.2 5.1 4.8 Unit production cost 2020 production ($/boe) 500 4.0 505 478 Production cost drivers: 472 465 443 Full-year Ngujima-Yin FPSO production 400 2.0 • (additional ~$
Slide 19: 2020 sales mix
FINANCIAL UPDATE 2020 sales mix 2019 and 2020 sales mix 100% 20% 13% 46% 26% 32% 30% Spot • No production shut-in 75% • Immediate increase in spot sales in Q2 due to: • LNG demand crashing in the early 50% stages of the pandemic • As a result, LNG buyers exercised Termed sales contractual flexibilit
Slide 20: Leveraging our marketing capability
FINANCIAL UPDATE Leveraging our marketing capability General target 15-20 • Uncontracted production provides flexibility to capture value % uncontracted production each year • Significant increase in Asian spot LNG prices emerged in January 2021, influenced by: • Colder northern hemisphere winter Ex
Slide 21: Strong investment grade credit rating
FINANCIAL UPDATE Strong investment grade credit rating S&P ratings of peers1 A- ConocoPhillips A- Inpex Corporation Long-term, BBB+ Woodside investment grade Investment grade BBB Origin Energy Limited credit rating BBB- Hess Corporation BBB- Marathon Oil Company High quality, BBB- Santos Limited low
Slide 22: Maintaining a strong balance sheet for FID in H2 2021
FINANCIAL UPDATE Maintaining a strong balance sheet for FID in H2 2021 Continuing strong liquidity Balanced debt maturity profile 8,000 1,500 6,952 6,704 • Gearing increased to 24.4% Asset impairments and 6,000 • onerous contract provision 1,000 (4.6%) $ million 3,918 $ million 4,000 • Cairn acquisi
Slide 23: Ongoing prudent capital management
FINANCIAL UPDATE Ongoing prudent capital management Multiple capital management levers to support Scarborough FID 1 Equity reduction targets 2 Focused expenditure management Sangomar to approximately 40-50% • Cash preservation • Continuing buyer interest • Operating cost focus in 2021+ • Improved ma
Slide 24: Production guidance
FINANCIAL UPDATE Production guidance Production guidance 2020 actual 2021 guidance • 2021 production guidance is 90 – 95 MMboe (MMboe) (MMboe) • KGP LNG Trains 2 and 4 will each be shutdown for approximately one month: LNG 75.0 70 – 72 • LNG Train 4 in Q2 2021 aligned with the Liquids1 19.5 17 – 20
Slide 25: Investment expenditure guidance
FINANCIAL UPDATE Investment expenditure guidance Investment expenditure guidance 3,500 $2,900-3,200 3,000 • 2021 investment expenditure guidance is 2,500 Sangomar 1 $2,900 – 3,200 million 2,000 Key drivers are Sangomar Phase 1 and $ million • Pluto Train 2 2 Scarborough 1,500 • Investment expenditur
Slide 26: Summary
SUMMARY Peter Coleman CEO and Managing Director
Slide 27: Scarborough preparing for FID
SUMMARY Scarborough preparing for FID Engineering work to support execution 2021 priorities Technical Scarborough resource increase Increased offshore design capacity to 8.0 Mtpa Execute remaining commercial Participating interests aligned agreements Commercial Finalise commercial agreements (early
Slide 28: 2021 priorities
SUMMARY 2021 priorities PRUDENT BALANCE SHEET MANAGEMENT CREATE AND PROTECT VALUE 1 Sell-down Pluto Train 2 3 Scarborough targeting FID H2 2021 Safe execution and delivery of 2 Sell-down Sangomar 4 Sangomar DISCIPLINED EXPENDITURE BUILD OUR SUSTAINABLE FUTURE Operations cost and efficiency 5 transfo
Slide 29: Annexure
nl ANNEXURE
Slide 30: Realised price
ANNEXURE Realised price Revenue 2020 2019 Variance Products impact ($/boe) ($/boe) (%) ($ million) LNG1,2,3 31 50 (37) (1,506) Domestic gas 14 14 - - Condensate 40 60 (33) (204) Oil 44 66 (32) (206) LPG 44 59 (24) (5) Volume-weighted average3 32 49 (33) (1,921) Average Dated Brent 42 64 (35) Average
Slide 31: Corporate performance
ANNEXURE Corporate performance 2020 2019 Production volume MMboe 100.3 89.6 Operating revenue $ million 3,600 4,873 EBITDA $ million 1,922 3,531 EBIT $ million (5,171) 1,091 Net finance costs $ million 269 229 Tax (benefit)/expense $ million (1,465) 480 Non-controlling interest $ million 53 39 NPAT
Slide 32: 2020 segment performance
ANNEXURE 2020 segment performance NWS Pluto Australia Oil Wheatstone Production volume MMboe 31 44 10 15 Operating revenue $ million 976 1,587 432 486 EBITDA $ million 702 1,274 222 355 EBIT $ million 1 (925) (735) (1,323) Cash margin % 74 81 74 75 Gross margin % 48 24 3 15 Full-Year 2020 Results Br
Slide 33: Head Office: Woodside Petroleum Ltd
Head Office: Woodside Petroleum Ltd Mia Yellagonga 11 Mount Street Perth WA 6000 Postal Address: GPO Box D188 Perth WA 6840 Australia T: +61 8 9348 4000 F: +61 8 9214 2777 E: companyinfo@woodside.com.au Woodside Petroleum Ltd ABN 55 004 898 962 woodside.com.au