Woodside Energy Beats Q2 Revenue Forecast on Sangomar Output, Exits Hydrogen Project with $140M Loss
Australia’s Woodside Energy delivered an 8% rise in second-quarter revenue, beating market expectations on the back of strong production from Senegal’s Sangomar project.
However, the company also reported significant write-downs tied to a failed hydrogen venture and rising decommissioning costs at aging offshore assets.
The country’s largest gas producer generated $3.28 billion in revenue for the three months ending June 30, up from $3.04 billion a year earlier.
The result topped analysts’ expectations, with Visible Alpha consensus placing revenue at $3.09 billion.
A key contributor was the Sangomar oil project, which added $510 million in revenue for the quarter. Overall production rose 13% year-over-year to 50.1 million barrels of oil equivalent (boe), compared to 44.4 million boe in Q2 2023.
Woodside also reported a reduction in unit production costs, lowering its annual guidance to $8.00–$8.50 per boe from the previous range of $8.50–$9.00 per boe.
The positive results helped push Woodside’s shares up by as much as 2.4% to a one-month high of A$25.44, outperforming a broader energy sub-index that rose more than 1%.
However, the upbeat revenue figures were offset by impairments, including a $140 million pre-tax write-down related to the cancellation of its H2OK hydrogen project in Oklahoma.
The company cited escalating costs and lower-than-expected demand in the low-carbon hydrogen sector as reasons for the exit.
“We have made the decision to exit the H2OK Project, demonstrating our disciplined approach to portfolio management,” Woodside said in a statement.
In addition, Woodside faces rising decommissioning expenses at several shuttered offshore facilities—Minerva, Stybarrow, and Griffin—where technical challenges are driving up costs.
The company anticipates $400 million to $500 million in pre-tax charges related to this work.
On the positive side, Woodside completed the sale of a 40% stake in its Louisiana LNG project to U.S.-based infrastructure investor Stonepeak for $5.7 billion in June.
Under the deal, Stonepeak will also fund 75% of the project’s capital expenditures in 2025 and 2026. Woodside noted ongoing interest from other potential partners for additional equity stakes.
In March, Woodside also agreed to sell certain oil and gas assets in Trinidad and Tobago to London-based Perenco, including production facilities and interests in shallow water fields.
Following the asset divestitures, Woodside slightly adjusted its 2025 production forecast to between 188 million and 195 million boe, compared to its prior range of 186 million to 196 million boe.
