Woodside Energy shares (ASX:WDS) dropped 0.66% today, as the cooling of tensions in the Middle East brought about by the recent ceasefire has seen oil prices drop back. Despite the recent 7.5% pullback below A$25, Woodside’s share price is holding the A$24 level today, one which has previously provided some level of support and resistance in the past.
Today, Woodside confirmed the sale of 40% of it’s interest in Louisiana LNG Infrastructure LLC to Stonepeak. As part of their end, Stonepeak made a closing payment of US$1.9billion to Woodside for it’s 75% share of capex funding, and will provide US$5.7billion towards expected capex on an accelerated basis through 2025, and 2026.
Woodside CEO MEg O’Neill commented
“Our partnership with Stonepeak reflects the attractiveness of Louisiana LNG and was a key milestone towards achieving a successful final investment decision. Stonepeak is a high-quality partner, with extensive investment experience across US gas and LNG infrastructure.
“The accelerated capital contribution from Stonepeak enhances Louisiana LNG project returns and strengthens our capacity for shareholder returns ahead of first cargo from the Scarborough Energy Project in Western Australia, targeted for the second half of 2026″
However, Woodside’s journey is not without its complexities. Historical data reveals a mixed bag. In February, the company reported a 13% decline in annual profit, its lowest in three years, attributed to weaker oil and gas prices. Despite these setbacks, Woodside maintained its production forecast for 2025, signaling confidence in future LNG demand.
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Woodside’s acquisition of OCI Clean Ammonia Holding B.V back in September 2024, for approximately $2.35 billion, represents a strategic move towards the growing lower-carbon ammonia market. This project, expected to produce its first ammonia by 2025 and lower-carbon ammonia by 2026, positions Woodside as an early mover in the evolving energy landscape.
The environmental approval granted to extend the operational life of its North West Shelf LNG project until 2070, highlights Woodside’s commitment to long-term growth, albeit with environmental implications. The North West Shelf extension, while crucial for processing gas resources, is projected to emit around 4.4 billion tonnes of CO₂ over its lifetime, raising concerns from environmental advocates.
From a financial perspective, Woodside presents an intriguing picture. The company’s earnings per share (EPS) currently stands at 2.91 AUD, with a P/E ratio of 8. The dividend yield is attractive at ~8%, although the payout ratio of 145.45% raises questions about sustainability. The forward dividend yield is projected at 6.48%, with a dividend per share of 1.67 AUD. WDS has a beta of 1.29 and a 2.71% volatility, indicating moderate risk and market sensitivity.
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