Woodside CEO Sees Plenty of Potential in Gulf of Mexico Under BHP Deal
By Rhiannon Hoyle
SYDNEY--Australia's Woodside Petroleum Ltd. believes there is
plenty of scope for growth in the Gulf of Mexico following an
agreement to buy BHP Group Ltd.'s global oil-and-gas business--a
deal that's also given Woodside significant confidence it can
proceed to make an investment decision on the Scarborough
natural-gas project this year, its new chief executive said.
Speaking in an interview, Meg O'Neill said Woodside and BHP have
established an integration team that will, among other things, put
together a way to prioritize Woodside's future investments provided
the proposed all-stock deal is completed next year as planned. The
companies announced the tie-up earlier this month, saying it would
turn Woodside a global top-10 independent energy company by
"One of the things that I think is really exciting about the
merger is it does give us a substantially increased growth
optionality when we look at the quality assets in the Gulf of
Mexico, the quality assets we have here in Australia and then other
opportunities in places like Trinidad, Tobago, Mexico and Senegal,"
said Ms. O'Neill.
S&P Global Ratings last week said it would expect the solid
free-cash-flow generation from BHP's petroleum assets to help
Woodside fund growth plans.
Ms. O'Neill highlighted BHP's Gulf of Mexico operations--which
include the Shenzi North oil project that BHP recently committed
US$544 million to developing--as very significant assets that
Woodside would intend to press ahead on. "We believe there is
significant running room in those assets," she said.
As part of the deal, Woodside and BHP also devised a plan to
target a final investment decision on the Scarborough project in
Australia by the end of 2021, with BHP having an option to sell its
26.5% stake for US$1 billion if that decision happens before Dec.
"In many ways, this gives ourselves and gives the market and
gives other potential investors confidence that we've got the
alignment with BHP towards taking that decision," Ms. O'Neill
Write to Rhiannon Hoyle at email@example.com
(END) Dow Jones Newswires
August 27, 2021 01:53 ET (05:53 GMT)
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