REG - Woodside Energy Grp. - WDS releases Reserves Statement &financial updates
15/02/2024 07:00
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RNS Number : 2601D Woodside Energy Group Ltd 15 February 2024
Woodside Energy Group Ltd
ACN 004 898 962
Mia Yellagonga
11 Mount Street
Perth WA 6000
Australia
T +61 8 9348 4000
www.woodside.com
ASX: WDS
NYSE: WDS
LSE: WDS
Announcement
Thursday, 15 February 2024
WOODSIDE RELEASES RESERVES STATEMENT AND FINANCIAL UPDATES
· Strategic merger with BHP Petroleum delivered high-quality
resources and record production in 2023
· Top quartile proved reserves life against peer group. 158% of
production replaced by proved plus probable reserves added in 2023
· Reserves additions from deepwater projects sanctioned in the Gulf
of Mexico and improved performance in North West Shelf and Pluto, partly
offset by reserves reductions in Shenzi
· Expected impairments associated with the goodwill and purchase
price allocated to Shenzi at the time of the merger with BHP Petroleum, and
Wheatstone short-term pricing, to be included in 2023 full-year financial
statements
Woodside announced today that it added 266 MMboe of proved oil and gas
reserves in 2023, replacing 132% percent of production, and 318 MMboe of
proved plus probable reserves in 2023, replacing 158% of production. 1 Proved
reserves life is 12.2 years given 2023 production levels, benchmarking in the
top quartile of global peers. 2
Woodside CEO Meg O'Neill said the reserves update reflects the quality of the
larger portfolio following the merger with BHP's petroleum assets and
establishes a continued platform for delivering strong shareholder returns.
"Woodside has delivered strong operational performance over the past 12
months. We achieved record production in 2023, while progressing a world-class
funnel of development opportunities, which have us well positioned for growth
and returns.
"Our success in integrating the strategic merger with BHP Petroleum, combined
with our ability to advance major projects and improve performance has
delivered a high-quality resource base that enjoys top quartile reserves life.
"We continued to see strong performance from our core assets in 2023."
Reserves and Resource update
At 31 December 2023, Woodside's remaining proved (1P) reserves were 2,450.1
MMboe, proved plus probable (2P) reserves remaining were 3,757.1 MMboe. The
best estimate (2C) contingent resources remaining were 5,902.0 MMboe. 3
The first-time booking of reserves at Trion in Mexico and Mad Dog Southwest in
the US Gulf of Mexico increased proved reserves by 204.1 MMboe and proved plus
probable reserves by
300.0 MMboe. Revisions of previous estimates and transfers in 2023 resulted in
a net increase of 61.8 MMboe for proved reserves, and 17.8 MMboe for proved
plus probable reserves. This includes improved performance and technical
updates at North West Shelf and Pluto, offset by a 13.4 MMboe proved reserve,
and a 30.2 MMboe proved plus probable reserve, reduction at Shenzi.
The reduction in reserves at Shenzi are mainly associated with the performance
of infill sidetracks and performance of the Shenzi North development following
start up.
Additionally, in 2023, Woodside completed a transaction whereby Calgary-based
Paramount Resources took a 50% equity interest in, and operatorship of, 28
leases of the Liard field in Canada. The transaction resulted in Woodside's 2C
contingent resources decreasing by 2,241.2 MMboe.
A copy of Woodside's Reserves and Resources Statement is attached.
2023 financials update
The 2023 full-year financial statements are expected to recognise non-cash
post-tax asset impairments amounting to approximately $1,500 million,
including approximately $1,200 million ($1,400 million pre-tax) impairment for
the Shenzi asset. This is primarily related to goodwill and a portion of the
purchase price assigned to Shenzi on completion of the merger with BHP
Petroleum. The goodwill and purchase price allocation resulted from
application of acquisition accounting principles and reflect both higher
hydrocarbon prices and Woodside's share price at the merger completion date.
Goodwill is not amortised and, once impaired, is not subject to a future
impairment reversal. For reference, Shenzi represented approximately 5% of
2023 production and approximately 2% of 2023 year-end proved plus probable
reserves.
The 2023 full-year financial statements are also expected to recognise a
non-cash post-tax impairment of approximately $300 million for Wheatstone,
mainly related to short-term pricing.
Impairments will be excluded for the purposes of calculating the 2023
full-year dividend, consistent with prior practice. All impairment values are
subject to the completion of the 2023 external audit.
2023 full-year line-item guidance Comments
Other costs
Impairment expense $ million ~1,900 ~$1,500 million post-tax. This includes impairments on Shenzi, Wheatstone and
Pyrenees (previously impaired as reported on 30 June 2023)
Net finance cost $ million ~35
Taxes
PRRT $ million 850 - 950 Includes de-recognition of Pluto PRRT Deferred Tax Asset (DTA) of $637 million
(as previously reported on 30 June 2023)
Income tax expense $ million 600 - 750 Includes effect of $319 million DTA recognised on Trion FID (as previously
reported on 30 June 2023) and impact of impairments
Contacts:
INVESTORS MEDIA
Marcela Louzada Christine Forster
M: +61 456 994 243 M: +61 484 112 469
E: investor@woodside.com E: christine.forster@woodside.com
This announcement was approved and authorised for release by Woodside's
Disclosure Committee
Forward-looking statements
This announcement contains forward-looking statements with respect to
Woodside's business and operations, market conditions, reserves and resources
estimates, results of operations and financial condition. All statements,
other than statements of historical or present facts, are forward-looking
statements and generally may be identified by the use of forward-looking words
such as 'guidance', 'foresee', 'likely', 'potential', 'anticipate', 'believe',
'aim', 'estimate', 'expect', 'intend', 'may', 'target', 'plan', 'strategy',
'forecast', 'outlook', 'project', 'schedule', 'will', 'should', 'seek' and
other similar words or expressions. Similarly, statements that describe the
objectives, plans, goals or expectations of Woodside are forward-looking
statements.
Forward-looking statements in this announcement are not guidance, forecasts,
guarantees or predictions of future events or performance. Those statements
and any assumptions on which they are based are subject to change without
notice and are subject to inherent known and unknown risks, uncertainties,
assumptions and other factors, many of which are beyond the control of
Woodside, its related bodies corporate and their respective officers,
directors, employees, advisers or representatives.
A detailed summary of the key risks relating to Woodside and its business can
be found in the "Risk" section of Woodside's most recent Annual Report
released to the Australian Securities Exchange and the London Stock Exchange
and in Woodside's most recent Annual Report on Form 20-F filed with the United
States Securities and Exchange Commission and available on the Woodside
website at https://www.woodside.com/investors/reports-investor-briefings. You
should review and have regard to these risks when considering the information
contained in this announcement.
All information included in this announcement, including any forward-looking
statements, reflect Woodside's views held as at the date of this announcement
and, except as required by applicable law, Woodside does not intend to,
undertake to, or assume any obligation to, provide any additional information
or update or revise any information or forward-looking statements after the
date of this announcement, either to make them conform to actual results or as
a result of new information, future events, changes in Woodside's expectations
or otherwise.
Investors are strongly cautioned not to place undue reliance on any
forward-looking statements. Actual results or performance may vary materially
from those expressed in, or implied by, any forward-looking statements.
Announcement contains inside information
This announcement contains inside information. Marcela Louzada, Vice President
Investor Relations is responsible for release of this announcement.
Notes relating to reserves and resources
Woodside is an Australian company with securities listed on the Australian
Securities Exchange, the New York Stock Exchange, and the London Stock
Exchange. Woodside reports its proved reserves in accordance with the
regulations of the United States Securities and Exchange Commission (SEC),
which are also compliant with SPE-PRMS guidelines, and prepares and reports
its proved plus probable reserves and 2C contingent resources in accordance
with SPE-PRMS guidelines. Woodside reports all petroleum resource estimates
using definitions consistent with SPE-PRMS.
Further notes relating to the disclosure of reserves and resources information
are included under the heading "Notes to the Reserves and Resources Statement"
in the accompanying Reserves and Resources Statement.
Disclosure of reserve information and cautionary note to US investors
The SEC prohibits oil and gas companies, in their filings with the SEC, from
disclosing estimates of oil or gas resources other than 'reserves' (as that
term is defined by the SEC). In this announcement, and the accompanying
Reserves and Resources Statement, Woodside includes estimates of quantities of
oil and gas using certain terms, such as 'proved plus probable (2P) reserves,'
'best estimate (2C) contingent resources,' 'reserves and contingent
resources,' 'proved plus probable,' 'developed and undeveloped,' 'probable
developed,' 'probable undeveloped,' 'contingent resources' or other
descriptions of volumes of reserves, which terms include quantities of oil and
gas that may not meet the SEC's definitions of proved, probable and possible
reserves, and which the SEC's guidelines strictly prohibit Woodside from
including in filings with the SEC. These estimates are by their nature more
speculative than estimates of proved reserves and would require substantial
capital spending over a significant number of years to implement recovery, and
accordingly are subject to substantially greater risk of being recovered by
Woodside. In addition, actual locations drilled and quantities that may be
ultimately recovered from Woodside's properties may differ substantially.
Woodside has made no commitment to drill, and likely will not drill, all
drilling locations that have been attributable to these quantities.
The Reserves Statement presenting Woodside's proved oil and gas reserves in
accordance with the regulations of the SEC will be filed with the SEC as part
of Woodside's annual report on Form 20-F. U.S. investors are urged to consider
closely the disclosures in Woodside's filings with the SEC, which are
available at www.sec.gov.
Other important information
All references to dollars, cents or $ in this announcement are to US currency,
unless otherwise stated. References to "Woodside" may be references to
Woodside Energy Group Ltd and/or its applicable subsidiaries (as the context
requires).
All financial information for the year ended 31 December 2023 included in this
announcement has been prepared by management solely based on currently
available information. Such information is based on estimates, is subject to
completion of our financial closing procedures and audit processes, and is not
a comprehensive statement of our financial results for the year ended 31
December 2023.
Reserves and Resources Statement
Woodside produced a total of 201.0 MMboe in 2023, including 186.1 MMboe
produced for sale and 15.0 MMboe of production consumed primarily as fuel in
operations.(1) At 31 December 2023, Woodside's remaining proved (1P) reserves
were 2,450.1 MMboe, proved plus probable (2P) reserves remaining were 3,757.1
MMboe, while the best estimate (2C) contingent resources remaining were
5,902.0 MMboe (Table 1).
The first-time booking of reserves at Trion in Mexico and Mad Dog Southwest in
the US Gulf of Mexico increased proved reserves by 204.1 MMboe and proved plus
probable reserves by 300.0 MMboe (shown as extensions and discoveries in Table
2), of which:
· final investment decision and regulatory approval of the field
development plan at Trion in August 2023 increased proved reserves by 194.8
MMboe and proved plus probable reserves by 287.2 MMboe; and
· approval of the Mad Dog Southwest Extension project increased
proved reserves by 9.3 MMboe and proved plus probable reserves by 12.7 MMboe.
Revisions of previous estimates and transfers in 2023 resulted in a net
increase of 61.8 MMboe for proved reserves and 17.8 MMboe for proved plus
probable reserves. Key drivers for these revisions include:
· asset optimisation, including injector to producer conversions,
and field performance at Angostura and Ruby in Trinidad and Tobago contributed
to proved and proved plus probable reserves increases of 13.0 MMboe and 19.3
MMboe, respectively
· improved overall field performance and technical updates in North
West Shelf increased proved reserves by 49.7 MMboe. North West Shelf proved
plus probable reserves decreased by 8.9 MMboe, due to the transfer of several
late life undeveloped projects to 2C contingent resources, partially offset by
improved overall field performance
· performance based revisions at Shenzi resulted in decreases in
both proved and proved plus probable reserves of 13.4 MMboe and 30.2 MMboe,
respectively
· improved overall field performance and technical updates at Pluto
and Macedon contributed to proved plus probable reserves increases of 28.4
MMboe and 14.7 MMboe, respectively.
Additionally, in 2023, Woodside completed a transaction whereby Calgary-based
Paramount Resources took a 50% equity interest in, and operatorship of, 28
leases of the Liard field in Canada. The transaction resulted in Woodside's 2C
contingent resources decreasing by 2,241.2 MMboe. Voluntary relinquishment of
Magellan in Trinidad and Tobago, and Wildling in the US Gulf of Mexico
resulted in a 77.2 MMboe decrease in 2C contingent resources.
The reclassification of undeveloped reserves to developed reserves is
discussed in the Undeveloped Reserves section of this Reserves and Resources
Statement.
Unless stated otherwise, the following apply to this Reserves and Resources
Statement(2): The effective date for reserves and resources estimates is 31
December 2023. Proved reserves are calculated using SEC-compliant economic
assumptions and pricing. Production is reported for the period from 1 January
2023 to 31 December 2023. Reserves, resources and production stated are
Woodside's net share and inclusive of fuel consumed in operations. All numbers
are internal estimates produced by Woodside. Estimates of reserves and
contingent resources should be regarded only as estimates that may change over
time as further production history and additional information becomes
available.
Table 1: Woodside's reserves(3)(,)(4)(,)(5)(,)(6) and contingent resources(7)
overview (net Woodside share, as at 31 December 2023)
Oil & condensate MMbbl Fuel included in total
Natural gas(8) NGLs(9) Total(10) MMboe(13) MMboe
Bcf(11) MMbbl(12)
Proved(14) developed(15) and undeveloped(16) 10,496.9 21.0 587.5 2,450.1 228.1
Proved developed 2,582.1 18.7 266.0 737.7 63.5
Proved undeveloped 7,914.7 2.3 321.6 1,712.5 164.6
Proved plus probable(17) developed and undeveloped 16,024.1 37.1 908.7 3,757.1 338.9
Proved plus probable developed 3,759.1 32.9 382.4 1,074.8 88.7
Proved plus probable undeveloped 12,264.9 4.2 526.3 2,682.3 250.1
Contingent resources(18) 27,786.8 80.6 946.5 5,902.0 362.3
Small differences are due to rounding
Methodology
Reserves and contingent resources estimates have not been adjusted for risk.
Proved reserves are estimated and reported on a net interest basis, excluding
royalties owned by others, in accordance with the United States Securities and
Exchange Commission (SEC) regulations and have been determined in accordance
with SEC Rule 4-10(a) of Regulation S-X. As defined by the SEC, proved
reserves are those quantities of crude oil, natural gas, and natural gas
liquids that, by analysis of geoscience and engineering data, can be estimated
with reasonable certainty to be economically producible from a given date
forward from known reservoirs and under existing economic conditions,
operating methods, operating contracts, and government regulations. Unless
evidence indicates that renewal of existing operating contracts is reasonably
certain, estimates of economically producible reserves reflect only the period
before the contracts expire. The project to extract the hydrocarbons must have
commenced or the operator must be reasonably certain that it will commence
within a reasonable time.
Proved reserves are estimated by reference to available well and reservoir
information, including but not limited to well logs, well test data, core
data, production and pressure data, geologic data, seismic data and, in some
cases, similar data from analogous, producing reservoirs. A wide range of
engineering and geoscience methods, including performance analysis, numerical
simulation, well analogues and geologic studies, have been used to develop
high confidence in estimated quantities.
Proved plus probable reserves and 2C contingent resources are estimated in
accordance with the 2018 Society of Petroleum Engineers/World Petroleum
Council/American Association of Petroleum Geologists/Society of Petroleum
Evaluation Engineers Petroleum Resources Management System (SPE-PRMS)
guidelines. SPE-PRMS guidelines allow (amongst other things) escalations to
prices and costs and, as such, volume estimates in accordance with those
guidelines would be on a different basis than volumes estimated as prescribed
by the SEC. Proved plus probable reserves and 2C contingent resources
estimates are inherently more uncertain than proved reserves estimates.
Governance and assurance
Woodside has several processes designed to provide assurance for reserves and
contingent resources reporting, including its Reserves and Resources Policy,
Petroleum Resources Management Procedure, Reserves and Resources Guideline,
annual staff training and minimum experience levels. The Woodside Reserves and
Resources Policy requires external audits of all projects or fields with
material reserves at least once every four years. In addition, Woodside has a
dedicated and independent Corporate Reserves Team (CRT) that provides
oversight and assurance of the reserves and resources assessments and
reporting processes. Reserves and resources are estimated by staff in teams
directly responsible for development and production activities. These
individuals are trained in the fundamentals of reserves reporting and are
approved by the CRT on an annual basis. Reserves assessments are reviewed
annually by the CRT to ensure technical quality, adherence to internally
published guidelines and compliance with SEC and SPE-PRMS reporting
requirements (as applicable). All reserves and resources are reviewed and
approved by Woodside's Qualified Petroleum Reserves and Resources Evaluator
and approved by senior management and the Board prior to public reporting.
Qualified Petroleum Reserves and Resources Evaluator statement
The estimates of petroleum reserves and contingent resources are based on and
fairly represent information and supporting documentation prepared by, or
under the supervision of Mr. Ben Stephens, Woodside's Vice President Reserves
and Subsurface, who is a full-time employee of the company and a member of the
Society of Petroleum Engineers. The Reserves and Resources Statement as a
whole has been approved by Mr. Stephens. Mr. Stephen's qualifications include
a Bachelor of Engineering (Petroleum Engineering) from the University of New
South Wales, Australia, and 20 years of relevant experience.
Table 2: Proved and proved plus probable developed and undeveloped reserves
reconciliation (net Woodside share, as at 31 December 2023)
Natural gas NGLs Oil & condensate Total
Bcf MMbbl MMbbl MMboe
Proved Proved plus probable Proved Proved plus probable Proved Proved plus probable Proved Proved plus probable
Reserves as at 31 December 2022 10,783.6 16,425.9 26.3 48.0 467.0 710.6 2,385.2 3,640.3
Acquisitions and divestments(19) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Revision of previous estimates(20) 355.9 348.5 1.6 -3.1 -0.8 -28.6 63.3 29.4
Transfer to/from reserves(21) -11.6 -62.4 0.1 -1.0 0.5 0.3 -1.5 -11.6
Extensions and discoveries(22) 177.9 121.0 0.4 0.5 172.5 278.2 204.1 300.0
Production(1) -809.0 -809.0 -7.3 -7.3 -51.8 -51.8 -201.0 -201.0
Reserves as at 31 December 2023(23) 10,496.9 16,024.1 21.0 37.1 587.5 908.7 2,450.1 3,757.1
Fuel included in reserves as at 31 December 2023 1,297.5 1,927.5 0.5 0.7 0.0 0.0 228.1 338.9
Small differences are due to rounding
Table 3: 2C contingent resources reconciliation (net Woodside share, as at 31
December 2023)
Natural gas NGLs Oil & condensate Total
Bcf MMbbl MMbbl MMboe
Contingent resources as at 31 December 2022 41,589.1 88.8 1,276.7 8,661.9
Acquisitions and divestments -12,774.6 0.0 0.0 -2,241.2
Extensions and discoveries 0.0 0.0 0.0 0.0
Transfer to/from reserves -58.6 0.4 -278.5 -288.4
Revision of previous estimates -969.0 -8.6 -51.7 -230.3
Contingent resources as at 31 December 2023(18) 27,786.8 80.6 946.5 5,902.0
Small differences are due to rounding
Table 4: Proved developed and undeveloped reserves (net Woodside share, as at
31 December 2023)
Country Assets Natural gas NGLs Oil & condensate Total
Bcf MMbbl MMbbl MMboe
Developed Undeveloped Total Developed Undeveloped Total Developed Undeveloped Total Developed Undeveloped Total
Australia Greater Pluto(24) 764.2 155.3 919.5 0.0 0.0 0.0 9.6 1.9 11.5 143.6 29.2 172.8
Bass Strait 279.6 64.6 344.2 8.6 1.0 9.6 6.2 1.2 7.4 63.9 13.5 77.4
North West Shelf(25) 825.6 0.0 825.6 4.0 0.0 4.0 26.4 0.0 26.4 175.3 0.0 175.3
Exmouth(26) 491.8 108.9 600.7 0.0 0.0 0.0 25.7 1.5 27.2 112.0 20.6 132.6
Scarborough(27) 0.0 7,336.0 7,336.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1,287.0 1,287.0
USA Gulf of Mexico(28) 87.8 16.2 104.0 6.1 1.3 7.4 197.2 68.7 265.9 218.7 72.9 291.6
Other International(29) 133.1 233.7 366.8 0.0 0.0 0.0 0.8 248.3 249.1 24.2 289.3 313.4
Total Reserves 2,582.1 7,914.7 10,496.9 18.7 2.3 21.0 266.0 321.6 587.5 737.7 1,712.5 2,450.1
Fuel included in reserves as at 31 December 2023 359.5 938.0 1,297.5 0.4 0.1 0.5 0.0 0.0 0.0 63.5 164.6 228.1
Small differences are due to rounding
Table 5: Proved plus probable developed and undeveloped reserves (net Woodside
share, as at 31 December 2023)
Country Assets Natural gas NGLs Oil & condensate Total
Bcf MMbbl MMbbl MMboe
Developed Undeveloped Total Developed Undeveloped Total Developed Undeveloped Total Developed Undeveloped Total
Australia Greater Pluto 1,235.9 243.1 1,479.0 0.2 0.1 0.3 15.7 3.1 18.8 232.7 45.8 278.5
Bass Strait 464.2 66.0 530.1 17.3 1.8 19.1 10.2 1.5 11.7 108.9 14.9 123.8
North West Shelf 1,088.0 0.0 1,088.0 5.6 0.0 5.6 35.5 0.0 35.5 232.0 0.0 232.0
Exmouth 619.1 272.9 892.0 0.0 0.0 0.0 35.1 3.4 38.6 143.7 51.3 195.1
Scarborough 0.0 11,461.4 11,461.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2,010.8 2,010.8
USA Gulf of Mexico 131.2 25.4 156.6 9.8 2.2 12.0 284.4 100.9 385.4 317.2 107.6 424.9
Other International 220.8 196.1 416.9 0.0 0.0 0.0 1.4 417.4 418.9 40.2 451.8 492.0
Total Reserves 3,759.1 12,264.9 16,024.1 32.9 4.2 37.1 382.4 526.3 908.7 1,074.8 2,682.3 3,757.1
Fuel included in reserves as at 31 December 2023 502.1 1,425.4 1,927.5 0.7 0.1 0.7 0.0 0.0 0.0 88.7 250.1 338.9
Small differences are due to rounding
Table 6: 2C contingent resources summary by region (net Woodside share, as at
31 December 2023)
Country Assets Natural gas NGLs Oil & condensate Total
Bcf MMbbl MMbbl MMboe
Australia Greater Pluto 1,061.8 0.0 20.2 206.5
Bass Strait 581.7 32.1 51.5 185.7
North West Shelf 539.0 4.3 35.9 134.8
Exmouth 709.4 0.0 46.5 171.0
Scarborough 1,632.2 0.0 0.0 286.4
Browse(30) 4,403.3 8.3 117.5 898.3
Greater Sunrise Special Regime Area Sunrise(31) 1,778.0 0.0 75.6 387.5
USA Gulf of Mexico 239.9 35.8 294.7 372.6
Canada Liard(18) 14,225.7 0.0 0.0 2,495.7
Other International 2,616.0 0.0 304.6 763.6
Total Resources 27,786.8 80.6 946.5 5,902.0
Small differences are due to rounding
Undeveloped reserves
At 31 December 2023, Woodside's remaining proved undeveloped reserves were
1,712.5 MMboe, representing an increase of 97.2 MMboe from the 1,615.2 MMboe
as at 31 December 2022 (Table 7).
Extensions and discoveries increased proved undeveloped reserves by 204.1
MMboe following the final investment decision and regulatory approval of the
field development plan at Trion, and approval of the Mad Dog Southwest
Extension project.
In 2023, 87.7 MMboe of proved undeveloped reserves were converted to proved
developed reserves with start-up of development wells in Mad Dog Phase 2 (56.0
MMboe), Shenzi North (10.5 MMboe), Atlantis (8.7 MMboe), and Pyrenees (1.1
MMboe), and completion of offshore Pluto water handling (11.3 MMboe).
Technical studies and performance resulted in a 3.4 MMboe decrease to proved
undeveloped reserves. The effect of commodity prices relative to 2022 resulted
in a 15.8 MMboe reduction to proved undeveloped reserves at Sangomar.
Undeveloped reserves in Julimar Brunello have remained undeveloped for longer
than five years from the dates they were initially reported and are expected
to be developed in a phased manner to meet long-term contractual
commitments. The project is included in the company business plan,
demonstrating the intent to proceed with the development.
The changes in proved undeveloped reserves in 2023 are summarised by category
in Table 7.
Table 7: Proved undeveloped reserves reconciliation (net Woodside share, as at
31 December 2023)
Total
MMboe
Reserves as at 31 December 2022 1,615.2
Extensions and discoveries 204.1
Revision of previous estimates -106.9
Reclassifications to developed -87.7
Performance, technical studies, and other -3.4
Development plan changes 0.0
Price -15.8
Acquisitions and divestments 0.0
Reserves as at 31 December 2023 1,712.5
Small differences are due to rounding
At 31 December 2023, Woodside's remaining proved plus probable undeveloped
reserves were 2,682.3 MMboe, representing an increase of 157.7 MMboe from the
2,524.5 MMboe as at 31 December 2022.
Extensions and discoveries associated with Trion and Mad Dog Southwest
increased proved plus probable undeveloped reserves by 300.0 MMboe.
In 2023, 130.1 MMboe of proved plus probable undeveloped reserves were
converted to proved plus probable developed reserves with start-up of
development wells in Mad Dog Phase 2 (71.7 MMboe), Shenzi North (28.6 MMboe),
Atlantis (15.8 MMboe), and Pyrenees (1.3 MMboe), and completion of offshore
Pluto water handling (12.7 MMboe). Additionally, 22.0 MMboe of late life
North West Shelf undeveloped projects were transferred to 2C contingent
resources.
During 2023, Woodside spent US$5.3 billion on development activities
worldwide. Of this amount, US$4.7 billion was spent progressing the conversion
of proved undeveloped reserves for projects where development status was
achieved in 2023 or is expected to be achieved when development is completed
in the future.
Additional information for US investors
The SEC prohibits oil and gas companies, in their filings with the SEC, from
disclosing estimates of oil or gas resources other than 'reserves' (as that
term is defined by the SEC). In this Reserves and Resources Statement,
Woodside includes estimates of quantities of oil and gas using certain terms,
such as 'proved plus probable (2P) reserves,' 'best estimate (2C) contingent
resources,' 'reserves and contingent resources,' 'proved plus probable,'
'developed and undeveloped,' 'probable developed,' 'probable undeveloped,'
'contingent resources' or other descriptions of volumes of reserves, which
terms include quantities of oil and gas that may not meet the SEC's
definitions of proved, probable and possible reserves, and which the SEC's
guidelines strictly prohibit Woodside from including in filings with the SEC.
These estimates are by their nature more speculative than estimates of proved
reserves and would require substantial capital spending over a significant
number of years to implement recovery, and accordingly are subject to
substantially greater risk of being recovered by Woodside. In addition, actual
locations drilled and quantities that may be ultimately recovered from
Woodside's properties may differ substantially. Woodside has made no
commitment to drill, and likely will not drill, all drilling locations that
have been attributable to these quantities. U.S. investors are urged to
consider closely the disclosures in Woodside's filings with the SEC, which are
available at www.sec.gov.
Notes to the Reserves and Resources Statement
1. 'Production' is the volume of natural gas, natural gas
liquids (NGLs), condensate and oil produced during the period from 1 January
2023 to 31 December 2023 and converted to 'MMboe' for the specific purpose of
reserves reconciliation. The production volume figures in this Reserves and
Resources Statement differ from the production volume figures reported
elsewhere in Woodside's reports, because the production volume figures
reported in this Reserves and Resources Statement include all fuel consumed in
operations but exclude 1.1 MMboe in excess of reserves working interest
percentage from Pluto non-operating participants processed via the Pluto-KGP
Interconnector. Small differences are due to rounding.
2. Woodside is an Australian company listed on the Australian
Securities Exchange, the New York Stock Exchange, and the London Stock
Exchange. Woodside reports its proved reserves in accordance with SEC
regulations, which are also compliant with SPE-PRMS guidelines, and prepares
and reports its proved plus probable reserves and 2C contingent resources in
accordance with SPE-PRMS guidelines. Woodside reports all petroleum resource
estimates using definitions consistent with SPE-PRMS.
3. For offshore oil projects, the reference point is defined as
the outlet of the floating production storage and offloading facility (FPSO)
or platform, while for the onshore gas projects the reference point is
defined as the outlet of the downstream (onshore) gas processing facility.
4. 'Reserves' are estimated quantities of petroleum that have
been demonstrated to be producible from known accumulations in which the
company has a material interest from a given date forward, at commercial
rates, under presently anticipated production methods, operating conditions,
prices, and costs. Woodside reports reserves inclusive of all fuel consumed in
operations. Proved reserves are estimated and reported in accordance with SEC
regulations which are also compliant with SPE-PRMS guidelines. SEC-compliant
proved reserves estimates use a more restrictive, rules-based approach and are
generally lower than estimates prepared solely in accordance with SPE-PRMS
guidelines due to, among other things, the requirement to use commodity prices
based on the average of first of month prices during the 12-month period in
the reporting company's fiscal year. Proved plus probable reserves are
estimated and reported in accordance with SPE-PRMS guidelines and are not
compliant with SEC regulations.
5. Assessment of the economic value in support of an SPE-PRMS
(2018) reserves and resources classification, uses Woodside Portfolio Economic
Assumptions (Woodside PEAs). The Woodside PEAs are reviewed on an annual
basis, or more often if required. The review is based on historical data and
forecast estimates for economic variables such as product prices and exchange
rates. The Woodside PEAs are approved by the Woodside Board. Specific
contractual arrangements for individual projects are also taken into account.
6. Woodside uses both deterministic and probabilistic methods
for the estimation of reserves and contingent resources at the field and
project levels. All proved reserves estimates have been estimated using
deterministic methods and reported on a net interest basis in accordance with
the SEC regulations and have been determined in accordance with SEC Rule
4-10(a) of Regulation S-X. Unless otherwise stated, all petroleum estimates
reported at the company or region level are aggregated by arithmetic summation
by category. The aggregated proved reserves may be a conservative estimate due
to the portfolio effects of arithmetic summation.
7. 'Contingent resources' are those quantities of petroleum
estimated, as of a given date, to be potentially recoverable from known
accumulations, but the applied project(s) are not yet considered mature enough
for commercial development due to one or more contingencies. Contingent
resources are estimated and reported in accordance with SPE-PRMS guidelines
and may include, for example, projects for which there are currently no viable
markets, or where commercial recovery is dependent on technology under
development, or where evaluation of the accumulation is insufficient to
clearly assess commerciality. Woodside reports contingent resources inclusive
of all fuel consumed in operations. Contingent resources are different from,
and should not be construed as, reserves. Contingent resources estimates may
not always mature to reserves and do not necessarily represent future reserves
bookings. Contingent resources volumes are reported at the 'Best Estimate'
(P50) confidence level. 2C contingent resources are not compliant with SEC
regulations. The SEC prohibits disclosure of oil and gas resources, including
contingent resources, in SEC filings. However, Australian securities
regulatory authorities allow disclosure of oil and gas resources, including
contingent resources.
8. 'Natural gas' is defined as the gas product associated with
liquefied natural gas (LNG) and pipeline gas. Liquid volumes of crude oil,
condensate and NGLs are reported separately.
9. 'Natural gas liquids' or 'NGLs' is defined as the product
associated with liquified petroleum gas (LPG) and consists of propane, butane,
and ethane - individually or as a mixture.
10. 'Total' includes fuel consumed in operations.
11. 'Bcf' means Billions (10(9)) of cubic feet of gas at standard
oilfield conditions of 14.696 psi (101.325 kPa) and 60 degrees Fahrenheit
(15.56 degrees Celsius).
12. 'MMbbl' means millions (10(6)) of barrels of NGLs, oil and
condensate at standard oilfield conditions of 14.696 psi (101.325 kPa) and 60
degrees Fahrenheit (15.56 degrees Celsius).
13. 'MMboe' means millions (10(6)) of barrels of oil equivalent.
Natural Gas volumes are converted to oil equivalent volumes via a constant
conversion factor, which for Woodside is 5.7 Bcf of dry gas per 1 MMboe.
Volumes of NGLs, oil and condensate are converted from MMbbl to MMboe on a 1:1
ratio.
14. 'Proved reserves' are those quantities of crude oil, condensate,
natural gas and NGLs that, by analysis of geoscience and engineering data, can
be estimated with reasonable certainty to be economically producible from a
given date forward from known reservoirs and under existing economic
conditions, operating methods, operating contracts, and government
regulations. Proved reserves are estimated and reported on a net interest
basis in accordance with the SEC regulations and have been determined in
accordance with SEC Rule 4-10(a) of Regulation S-X.
15. 'Developed reserves' are those reserves that are producible
through currently existing completions and installed facilities for treatment,
compression, transportation and delivery, using existing operating methods and
standards.
16. 'Undeveloped reserves' are those reserves for which wells and
facilities have not been installed or executed but are expected to be
recovered through future significant investments.
17. 'Probable reserves' are those reserves which analysis of
geological and engineering data suggests are more likely than not to be
recoverable. Proved plus probable reserves represent the best estimate of
recoverable quantities. Where probabilistic methods are used, there is at
least a 50% probability that the actual quantities recovered will equal or
exceed the sum of estimated proved plus probable reserves. Proved plus
probable reserves are estimated and reported in accordance with SPE-PRMS
guidelines and are not compliant with SEC regulations.
18. 'Liard' comprises unconventional contingent resources in the
Liard Basin. As at 31 December 2023, Liard represents approximately 42% of
Woodside's 2C contingent resources.
19. 'Acquisitions and divestments' are revisions that represent
changes (either upward or downward) in previous estimates of reserves or
contingent resources, which result from either purchase or sale of interests
and/or execution of contracts conveying entitlement.
20. 'Revision of previous estimates' are changes (either upward or
downward) in previous estimates of reserves or contingent resources, resulting
from new information normally obtained from development drilling and
production history, or resulting from a change in economic factors.
21. 'Transfer to/from reserves' are revisions that represent changes
(either upward or downward) in previous estimates of reserves or contingent
resources, which are a result of re-classification of petroleum resources
estimates (i.e. from reserves to contingent resources or vice versa)
associated with one or more project(s).
22. 'Extensions and discoveries' represent additions to reserves or
contingent resources that result from increased areal extensions of previously
discovered fields demonstrated to exist subsequent to the original discovery
and/or discovery of reserves or contingent resources in new fields or new
reservoirs in old fields.
23. Proved reserves at 31 December 2023 are estimated and reported
in accordance with SEC regulations. Proved plus probable reserves and
contingent resources at 31 December 2023 are estimated and reported in
accordance with SPE-PRMS guidelines.
24. 'Greater Pluto' consists of the Pluto, Xena, Pyxis, Larsen,
Martell, Martin, Noblige, and Remy fields.
25. 'North West Shelf' consists of all oil and gas fields within the
North West Shelf Project Area.
26. 'Exmouth' consists of the Pyrenees, Macedon, Julimar-Brunello,
and Ngujima-Yin fields.
27. 'Scarborough' consists of Scarborough, Thebe, and Jupiter
fields. Scarborough proved undeveloped reserves as at 31 December 2023 are
7,336.0 Bcf (1,287.0 MMboe). Development activities are underway. In this
Reserves and Resources Statement, Scarborough estimates are based on one
hundred per cent interest in the Scarborough Joint Venture until completion of
the transaction with LNG Japan referenced in the announcement on 8 August 2023
entitled "Woodside to Sell 10% Scarborough Interest to LNG Japan".
28. 'Gulf of Mexico' consists of the Shenzi, Shenzi North, Atlantis,
and Mad Dog fields.
29. 'International' consists of the Angostura, Ruby, Trinidad and
Tobago Deep Water, Trion, and Sangomar fields which are under
Production/Revenue Sharing-type agreements. These fields represent
approximately 13% of proved reserves, proved plus probable reserves, and 2C
contingent resources. Woodside net economic interest volumes are reported.
30. 'Browse' consists of the Brecknock, Calliance, and Torosa
fields.
31. 'Sunrise' consists of the Sunrise and Troubadour fields.
1 Reserve replacement is the extent to which the year's production has
been replaced by reserves added to our reserve base. This includes changes
resulting from extensions and discoveries, transfers, revisions to previous
estimates, and acquisitions and divestments.
2 Peer set is APA, ConocoPhillips, Coterra Energy, Devon, ENI, EOG, Equinor,
Hess, Inpex, Marathon, OXY and Santos. Comparison is relative to 2022 Annual
Reports. Canadian oil sands companies are excluded.
3 Proved reserves include 228.1 MMboe fuel; proved plus probable reserves
include 338.9 MMboe fuel; 2C contingent resources include 362.3 MMboe fuel
(Woodside share).
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