$1m an hour: War, BHP deal drive energy giant to record profit

A bigger and more global Woodside made more than $1 million of profit an hour in 2022 after swallowing BHP’s petroleum assets and benefiting from Europe scrambling for non-Russian gas supplies.

Woodside chief executive Meg O’Neill reported a $US6.50 billion ($9.65 billion) net profit after tax for 2022 that included seven months’ ownership of the assets BHP shed to concentrate on what the miner terms forward-facing commodities needed for the energy transition.

Woodside chief Meg O’Neill. The company handed out a fully franked $US1.44 a share dividend bringing the payout to $US2.53 for the year.Credit:Trevor Collens

O’Neill said 2022 – when the average price it received for its oil and gas rose 63 per cent – was a momentous year for the Perth-based company.

“Woodside is now a larger, geographically diverse energy company with the financial and operational strength to grow our portfolio of high-quality assets,” she said.

O’Neill said while prices for the liquefied natural gas it exports had fallen from the heady levels of 2022 it was still above historic norms with the price marker for selling to Japan sitting at about $US15 per million British thermal units.

“Three years ago, we would have been ecstatic to be at that price level,” she said.

Woodside shareholders – including BHP shareholders, who were awarded 48 per cent of the enlarged firm’s equity – will receive a fully franked $US1.44 a share dividend bringing the payout to $US2.53 for the year.

The BHP purchase has taken Woodside away from its traditional focus on gas from the waters off Australia’s north-west coast to the east coast gas market and a strong presence in North America where both major final investment decisions for 2023 are located.

The Trion development off the coast of Mexico is planned to produce a 100,000 barrels of oil a day and the H2OK hydrogen plant in Oklahoma would be Woodside’s first substantial investment in non-fossil fuel energy.

The company is ahead of schedule in achieving $US400 million in annual savings from the merger that incurred one-off transaction and integration costs of $US633 million.

UBS analyst Tom Allen said it was a slightly softer result than he expected due to higher tax and restoration expenses.

Woodside shares were up 0.4 per cent to $34.72 a share in early afternoon trade.

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