Woodside Energy Group Ltd · ASX:WDS
Woodside Energy — Woodside Petroleum — Investor Day (December 2021)
32 slides from Woodside Energy's investor day presentation, Dec 8, 2021
Slide 1: ASX Announcement: Investor Update 2021
ASX Announcement Woodside Petroleum Ltd. ACN 004 898 962 Mia Yellagonga Wednesday, 8 December 2021 11 Mount Street Perth WA 6000 ASX: WPL Australia OTC: WOPEY T +61 8 9348 4000 www.woodside.com.au INVESTOR UPDATE 2021 Woodside CEO Meg O’Neill has unveiled Woodside’s strategy to thrive through the en
Slide 2: Event details
Event details Meg O’Neill will present an update on Woodside’s strategy and value proposition in a virtual event today, commencing at 12:30 AEDT / 09:30 AWST. The Investor Update 2021 will be followed by a question and answer session, commencing at 13.30 AEDT / 10.30 AWST. We recommend participants
Slide 3: Investor Update 2021
INVESTOR UPDATE 2021 8 December 2021 www.woodside.com.au investor@woodside.com.au
Slide 4: Disclaimer, risks and assumptions
Disclaimer, risks and assumptions Disclaimer and risks Notes to petroleum resources estimates • Our investors and potential investors have requested that Woodside continues to provide further detail and information in 1. Unless otherwise stated, all petroleum resource estimates are quoted as at the
Slide 5: Agenda
Agenda 1 STRATEGY 2 CAPITAL ALLOCATION 3 SHAREHOLDER RETURNS 4 CLIMATE 5 NEW ENERGY 6 MERGER AND DEVELOPMENTS 3
Slide 6: Thriving through the energy transition
Thriving through the energy transition PROFITABLE LOWER CARBON RESILIENT OPTIMISE VALUE AND LOW COST DIVERSIFIED SHAREHOLDER RETURNS 4
Slide 7: Strategic framework
Strategic framework COMPETITIVE DISCIPLINED CAPITAL ADVANTAGE ALLOCATION Highly valued products Robust assessment of opportunities, portfolio outcomes World-class Tier 1 assets and shareholder returns Diversification within known Enablers Disciplined capital spend value chains Safe and reliable oper
Slide 8: ESG is part of our core business
ESG is part of our core business Environmental Social Governance Climate change resilience and transition Social and cultural impacts on communities Health safety and wellbeing Environment and biodiversity People and culture Corporate governance Decommissioning Supply chain and local content Major i
Slide 9: Market analysis
Market analysis Estimated cumulative investment under the range of IEA scenarios ($US trillion) STEPS APS Investment in oil and gas exceeds 30 30 hydrogen investment in all scenarios 26.1 20 20 19.5 Increased investment in hydrogen 10 needed to support the Net Zero 10 Emissions 2050 pathway 0.3 1.2
Slide 10: Climate testing
Climate testing Indicative average annual free cash flow under the range of IEA scenarios1 Product pricing is the primary driver of the variation Portfolio decisions are assessed against a wide range of climate Free cash flow (US$) STEPS scenarios Climate scenarios include International Energy Agenc
Slide 11: Portfolio and opportunity optimisation
Portfolio and opportunity optimisation Portfolio evaluation considerations Opportunity evaluation considerations Free cash Funding Emissions Strategic Payback EPS IRR/NPV Risk Breakeven flow capacity profile fit period Growth opportunities are screened against portfolio metrics using price, scenario
Slide 12: Capital allocation framework
Capital allocation framework OIL GAS NEW ENERGY OFFSHORE PIPELINE LNG DIVERSIFIED Generate high returns to fund New energy products and lower Leveraging infrastructure to monetise undeveloped FOCUS diversified growth, focusing on gas, including optionality for hydrogen carbon services to reduce cust
Slide 13: Shareholder returns
Shareholder returns OPTIMISE VALUE AND SHAREHOLDER RETURNS Special dividends Safe, Dividend Strong reliable and Investment policy Share balance low cost expenditure (minimum 50% buy-backs sheet operations payout ratio) Excess cash Future investment Investment grade Maintain dividend based Targeted c
Slide 14: Thriving in a lower-carbon future
Thriving in a lower-carbon future DECARBONISATION TARGETS Emissions reduction targets apply to Woodside’s equity portfolio (operated 15% 30% Net zero and non-operated) by 2025 by 2030 aspiration by 2050 or sooner Equity net emissions reduction targets1 Clear targets consistent with Paris-aligned pat
Slide 15: Scope 3 emissions approach
Scope 3 emissions approach INVEST NEW ENERGY PRODUCTS | LOWER CARBON SERVICES $5 billion invested by 20301 Collaboration with customers to build market demand Recent announcements: Heliogen, H2Perth, H2TAS, H2OK, CCS SUPPORT PROMOTE CUSTOMER AND SUPPLIER EMISSIONS REDUCTION GLOBAL MEASUREMENT AND RE
Slide 16: Energy transition plan
Energy transition plan ENERGY TRANSITION PROGRESS 2021 Mid-2020s 2030+ Market Early new energy New energy development transition at scale • Build relationships across value chain • Achieve start-up of new energy • Export liquid hydrogen from projects Australia • Technology flexible (hydrogen, CCS, r
Slide 17: New energy opportunities
New energy opportunities H2Perth | Flexible design for hydrogen or ammonia H2OK | Emerging opportunity for heavy transport sector • Initial phase targeting ~110,000 tpa • Initial phase targeting ~33,000 tpa of hydrogen production including of liquid hydrogen leveraging 250 MW electrolysis component
Slide 18: New energy growth plan
New energy growth plan Cumulative capacity (megawatts, indicative) 3,000 Potential 2030 capacity ~3,000 megawatts 2,000 Phased project 1,000 expansion to match customer demand 0 2022 2024 2026 2028 2030 Power for base business FEED | Execute Phase 1 (Pluto) Phase 2 Phase Heliogen FEED | Execute Phas
Slide 19: Carbon business
Carbon business • Diverse, cost competitive foundation portfolio to support base business and Scarborough demand • Collaboration with customers for supply of carbon offset cargoes Secured offsets to meet 2025 High quality ~10,000 ha of land secured for planting native trees net emissions reduction t
Slide 20: 2021 priorities delivered and a merger
2021 priorities delivered and a merger DISCIPLINED Cost and efficiency transformation 1 EXPENDITURE underway Achieved targeted Scarborough FID in H2 2021 Proposed merger with 2 CREATE AND 5 BHP’s petroleum PROTECT VALUE 3 business Delivering Sangomar Phase 1 BUILD OUR Delivering value through 4 SUST
Slide 21: Merger strategic rationale
Merger strategic rationale + Petroleum All-stock merger of Woodside and BHP Petroleum PORTFOLIO QUALITY Complementary, long-life, high margin, tier 1 assets CASH GENERATION AND BALANCE SHEET Strengthens cash generation and balance sheet SHAREHOLDER RETURNS AND CAPITAL DISCIPLINE Supports superior re
Slide 22: International portfolio of Tier 1 assets
International portfolio of Tier 1 assets 200 MMboe Senegal ~ Sangomar 2021 production1 Top 10 independent2 East coast Australia 10.6 Mt Houston Bass Strait LNG production3 Gulf of Mexico Top 10 global4 Shenzi | Wildling | Atlantis | Mad Dog | Trion Scarborough FID achieved Perth Attractive near-term
Slide 23: Timeline to completion
Timeline to completion Q3 2021 Q4 2021 Q1 2022 Q2 2022 17 August 22 November Target for release of Target for Woodside shareholder Merger commitment deed Share sale agreement and shareholder materials meeting to approve issue of shares executed integration and transitional services agreement execute
Slide 24: Organisational design after completion
Organisational design after completion CEO Exploration Marketing Australia International and and New Energy Operations Operations Development Trading Strategy Technical Business Finance Projects and Services Services Climate 22
Slide 25: Planning opportunities to deliver synergies after merger completion
Planning opportunities to deliver synergies after merger completion • Implement existing activities already identified by Operations Transform initiatives and identify opportunities for broader implementation after completion OPERATIONS • Potential to improve inventory management and consolidation o
Slide 26: Scarborough and Pluto Train 2 developments approved
Scarborough and Pluto Train 2 developments approved DEVELOPS WORLD-CLASS RESOURCE Scarborough floating production unit Pluto 11.1 8 957 1,433 platform Tcf Mtpa of LNG MMboe MMboe resource size, 100%3 development plus increase to 1P reserves increase to 2P reserves 225 TJ/day domestic gas PROVIDES LO
Slide 27: Scarborough's role in the energy transition
Scarborough’s role in the energy transition LNG is required Scarborough is advantaged Woodside’s net zero aspiration in a decarbonising world from a carbon perspective1 includes Scarborough 0.1 0.26 LNG can assist coal-to-gas tCO2-e/ switching in Asia ~ % ~ t LNG CO2 in reservoir Train 2 design inte
Slide 28: Sangomar progress
Sangomar progress SUBSEA Umbilical on carousel Inline structure sliding frame Assembled inline structure FPSO CONVERSION DALIAN Turret support Living quarters Turret support structure structure integration 26
Slide 29: Sangomar progress
Sangomar progress FPSO TOPSIDES – TIANJIN FPSO TURRET – PENGLAI SENEGAL Medium pressure gas compression Chain table support system coating Liquid mud plant topsides assembly completed Electrical house Turret head system coating Sumitomo tubular yard 27
Slide 30: Key messages
Key messages STRATEGY Thriving through the energy transition CAPITAL ALLOCATION Clear criteria for maximising value from portfolio optionality SHAREHOLDER RETURNS Flexible framework for distributing value to shareholders Corporate emissions reduction targets applying to the larger portfolio; CLIMATE
Slide 31: Additional information for US investors
Additional information for US investors No offer or solicitation Disclosure of reserve information and cautionary note to US investors • This presentation includes information relating to the proposed Transaction between Woodside and BHP. • Unless expressly stated otherwise, all estimates of oil and
Slide 32: 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