Woodside posts solid quarter

PERTH (miningweekly.com) – Oil and gas major Woodside has reported an 8% increase in production for the quarter ended September, with production reaching 47.8-million barrels of oil equivalent.

The company on Wednesday also narrowed its full-year production guidance to between 183-million and 188-million barrels of oil equivalent.

CEO Meg O’Neill told shareholders that the increase in production, compared with the June quarter of this year, was underpinned by strong operating results from the Pluto liquefied natural gas (LNG) operation.

“The 99.9% reliability achieved at Pluto during the third quarter followed the completion of a maintenance turnaround in June. Production from North West Shelf was impacted by planned turnaround and maintenance activities in the quarter, but the facility’s reliability was still exceptional at 98.9%.

“Woodside’s project teams made strong progress over the course of the quarter. In September, first production at the Shenzi North tieback in the US Gulf of Mexico was achieved ahead of the original 2024 schedule. Production at Mad Dog Phase 2 offshore Louisiana, which started up in April, continued to ramp up during the quarter.

“Activity at Scarborough and Pluto Train 2 increased as planned and the project is now 46% complete. Installation of the nearshore component of the Scarborough trunkline commenced and fabrication of the floating production unit topsides and hull continued.

“Site construction works for Pluto Train 2 are progressing and we have awarded the engineering, procurement and construction contract for the Pluto Train 1 modifications that will allow it to process Scarborough gas,” said O’Neill.

She noted that the Federal Court’s September decision that the Commonwealth Environment Plan for the Scarborough offshore seismic survey is invalid, has not impacted Woodside’s target for first LNG cargo in 2026.

The decision does, however, highlight the urgent need for reform of Australia’s offshore approvals process, she said.

“Uncertainty over approvals has the potential to add cost and delays to any offshore activities to be undertaken in Australia. In the case of gas projects, such uncertainty threatens the delivery of much-needed new supplies to the Western Australian domestic market, as well as undermining the confidence of our regional trading partners.

“The importance of Scarborough to regional energy security was demonstrated in August when LNG Japan agreed to purchase a 10% non-participating interest in the joint venture.”

At Sangomar, in Senegal, another two of the 23 planned wells were drilled, taking the total now completed to 14. O’Neill said Wednesday that pre-commissioning work at the floating production storage and offloading vessel continued in Singapore. Overall, the Sangomar project is 90% complete and we remain on track for targeted first oil in mid-2024.

“A significant milestone for our deepwater Trion project was passed during the quarter, with the approval of the field development plan by the Mexican regulator. Project execution activities at Trion are progressing.

“In new energy, progress was made on contracts for the plant construction scope and other critical packages at our proposed H2OK facility in Oklahoma. Technical work to support readiness for a final investment decision at H2OK is expected to be completed in 2023, although a decision itself has been delayed, pending clarification of government tax incentives and the finalisation of offtake agreements.

“During the quarter we signed two non-binding memoranda of understanding with a total of four Japanese companies to jointly study potential carbon capture and storage (CCS) value chains between Australia and Japan. We believe that with collaboration between industry partners and governments, CCS could provide a pathway to help our Japanese customers decarbonise,” she said.