AUS
NZ
UK
CA
USA
IND
Highlights
- Woodside Energy (WDS) experiences a 3% drop in share price after reserves update.
- Proved reserves decrease to 1,975.7 million barrels of oil equivalent (MMboe).
- CEO highlights successful projects as factors in reserves addition.
Woodside Energy (ASX:WDS) shares have faced a notable decline of over 3% following the release of its 2024 reserves update. The oil and gas giant reported a decrease in both its proved and proved-plus-probable reserves, sending its stock down to $23.75 by 11 a.m. AEDT. This drop in share price comes after Woodside reported a reduction in its reserves for the year, despite promising developments in some of its major projects.
According to the reserves update, Woodside’s proved reserves fell to 1,975.7 million barrels of oil equivalent (MMboe), down from 2,450 MMboe in 2023. Additionally, the company’s proved-plus-probable reserves saw a decline, from 3,757 MMboe in the previous year to 3,092.2 MMboe. One of the primary factors contributing to this reduction was the divestment of 25.1% of Woodside’s stake in the Scarborough field, which led to a reduction of 323 MMboe in proved reserves and 504.7 MMboe in proved-plus-probable reserves.
However, excluding the impact of divestments and ongoing production, Woodside’s proved reserves increased by 54.9 MMboe, while its proved-plus-probable reserves rose by 46.2 MMboe. This increase can be attributed to successful developments in Woodside’s global projects, including strong performance at the Sangomar oil project in Senegal. The company also saw positive results from its final investment decisions on projects in both Australia and the US, which contributed to the reserves additions.
Despite this boost in reserves from ongoing developments, Woodside continues to face challenges. Over the last 12 months, the company’s shares have retreated by more than 20%, reflecting broader trends in the energy sector, which has been impacted by falling crude prices. As of today, the energy sector as a whole also saw a decline, with crude prices dipping overnight, further adding pressure to the sector's performance.
CEO Meg O'Neill remains optimistic about Woodside’s portfolio, asserting that the reserves update demonstrates the strength of the company’s diversified projects, despite the fluctuations in market conditions. The future growth of the company seems reliant on continued strong project performance and strategic investment decisions.
Woodside faces some headwinds in the short term, its ongoing project success and strategic moves suggest the potential for recovery in the longer term.
