Woodside Energy sees European winter and Chinese recovery cloud gas price outlook

Woodside Energy sees European winter and Chinese recovery cloud gas price outlook
Woodside Energy sees European winter and Chinese recovery cloud gas price outlook
  • LNG outlook hinges on China and European winter – CEO
  • Fourth quarter revenue jumps 78% on record production
  • Production growth forecast of 4% per year until 2027 intact

MELBOURNE, Jan 25 (Reuters) – The chief executive of Woodside Energy Group Ltd (WDS.AX) said wintery temperatures in Europe and China’s economic recovery are among factors clouding the near-term outlook for gas prices, which have fallen from all-time highs of last year. .

Australia’s largest independent gas producer reported a 78% increase in fourth-quarter revenue on Wednesday on record production, slightly ahead of analysts’ forecasts, benefiting from high LNG prices and its asset buyout BHP Group (BHP.AX) tankers, completed in June.

That puts the company on track for record earnings of around $5.6 billion for 2022, analysts’ estimates polled by Refinitiv showed. Forecasts for 2023, however, call for a slight decline in profits due to lower oil and gas prices.

Chief executive Meg O’Neill said the jury is out on the outlook for liquefied natural gas (LNG) prices in the near term.

“Last year was a truly exceptional year in terms of what happened in energy markets globally. The prices we see today are still well above historical norms,” O’Neill said in an interview.

“There is still a lot of uncertainty around, for example, the rest of the European winter and how cold it will be. The question arises as to how fast Chinese economic activity and energy demand is growing.”

Revenue for the three months ended Dec. 30 soared to $5.16 billion on record production of 51.6 million barrels of oil equivalent. The company’s average realized price jumped 9% to $98 per barrel of oil equivalent from a year earlier.

Woodside remains confident it can begin producing gas from its largest project, the $12 billion Scarborough development and Pluto LNG expansion, in 2026, despite further consultations with Indigenous groups required by Federal Court to receive final environmental approvals.

“Our project teams are very good at adapting to challenges and adjusting business plans. So at this point the project is still on track,” O’Neill told Reuters.

While Woodside said the government’s plans to control gas prices could discourage new projects, O’Neill reiterated the outlook for production growth of 4% per year through 2027, saying it was based on its major projects already underway.

Reporting by Sonali Paul in Melbourne; Additional reporting by Harish Sridharan and Navya Mittal in Bengaluru; Editing by Devika Syamnath and Christopher Cushing

Our standards: The Thomson Reuters Trust Principles.

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. Woodside Energy sees European winter Chinese recovery cloud gas price outlook

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