Woodside Energy Group Ltd (WDS) Earnings

Management highlights

### Overall Financial Performance & Capital Returns - Delivered strong operational and financial results amid historic global energy market volatility, with year-on-year free cash flow growth exceeding 150% - The Board declared a fully franked interim dividend of 57 US cents per share, at the top end of the company's 50-80% payout range - Approximately $12 billion has been returned to shareholders since the 2022 merger with BHP's petroleum business - End-of-period gearing was 20.6%, marginally above the 10-20% target range, which is permitted as temporary flexibility during the capital-intensive project execution phase ### Operational & Project Progress - Total half-year production hit 86.5 million barrels of oil equivalent, with one high-consequence safety incident recorded and zero Tier 1 or Tier 2 process safety events across 11 million work hours - The Scarborough Energy Project was 98% complete at half-year end, remains on schedule and budget for first LNG cargo in Q4 2026, with the floating production unit achieving ready-for-startup status post-period - The Trion project was 64% complete at half-year end, on track for first oil in 2028, with key construction and drilling milestones achieved - Louisiana LNG was 28% complete at half-year end, progressing on schedule and budget, with major construction milestones including commencement of berth dredging, installation of first mechanical equipment for Train 1 (35% complete), and erection of first structural steel for Train 2 - Post-period, Woodside assumed operatorship of Gippsland Basin assets and agreed to divest its interest in the Calypso project in Trinidad and Tobago, exercising its preemption right to increase equity in the Browse resource - Decommissioning work is progressing as planned, with plug and abandonment commenced on eight subsea wells at the Northwest Shelf, and 26 kilometres of flowlines/umbilicals removed at Stuyborough and Griffin ### Updated Strategic Priorities - Announced a new annual structural cost reduction target of $350 million to be delivered from 2028, spanning operating costs, corporate overheads, and sustaining capital expenditure, enabled by a simplified, faster decision-making organizational structure - Moved to a single unified capital allocation framework where all investment opportunities (including new energy) compete equally for capital based on shareholder value creation, with new energy investments required to be underpinned by clear customer demand and commercial viability - Initiated a strategic review of the Beaumont New Ammonia asset (now in operation) after market and regulatory conditions for low-carbon ammonia developed slower than expected; all options for the asset will be considered - Retired the previous Scope 3 investment and emissions abatement targets, which were set under a different market context and slower-than-expected development of lower carbon technology and markets; the 2030 Scope 1 and 2 emissions reduction target remains unchanged - The company remains on track to hit its 2030 target of 30% reduction in net equity Scope 1 and 2 greenhouse gas emissions from baseline

Guidance

- Gearing is expected to return to below the 20% upper target range by the end of the 2026 full year, driven by higher second half production (no Pluto turnaround), a strong pricing environment, and cash settlement of 62% of hedges in the first half that leaves more upside for the second half - The full comprehensive updated capital strategy, including full details of the new single capital allocation framework and cost out program, will be presented at the Capital Markets Day on November 5, 2026 - Scarborough is on track to deliver first LNG cargo in Q4 2026, with sustained commercial operations starting in 2027 - Trion remains on track for first oil in 2028 - The $350 million annual structural cost savings target will be fully implemented and available from 2028, with work underway to identify and deliver sustained savings - Long-term structural demand for LNG remains robust, with Wood Mackenzie forecasting ongoing demand growth in Asia through the 2040s and continued upward revisions to European long-term gas demand forecasts

Segment performance

The transcript does not break out financial performance into distinct product segments with separate absolute revenue and revenue contribution figures. Aggregate half-year 2026 results for the full company are: total production of 86.5 million barrels of oil equivalent, EBITDA of $4.6 billion, underlying net profit after tax of $1.3 billion, free cash flow of $352 million, net operating cash flow of $3 billion, and total liquidity of $8.2 billion. Sangamah delivered 15 million barrels of oil equivalent (Woodside share) at 99.5% reliability and has generated $3.8 billion in cumulative EBITDA since startup. The Gippsland Bass Strait assets currently account for 40% of Australian domestic gas supply (20% Woodside equity share).

Risks & headwinds

- Ongoing Middle East conflict has removed 20% of global LNG supply and 13% of global oil supply from markets, leading to sustained price volatility and supply disruptions that are expected to continue - The proposed Australian domestic gas reservation scheme's final technical details, regulatory framework, and pricing rules will determine whether Woodside makes a final investment decision on the potential 200 petajoule Bass Strait gas development - Supply chain disruption risk from the Middle East conflict for Louisiana LNG steel fabrication is being mitigated by alternative supply routes and alternative fabrication locations, and the project remains on schedule - Beaumont New Ammonia production has been constrained by third-party feedstock availability during the first half, and this constraint is expected to continue through 2027 - The development of markets for lower carbon opportunities (hydrogen, ammonia, carbon capture and storage) has proceeded much slower than previously anticipated, requiring a more disciplined approach to new energy capital allocation - Safety performance remains a key risk; the one high-consequence injury recorded in the half is considered one too many, with ongoing work to improve risk management across all operations

Analyst Q&A

• Q: Given the strategic review of Beaumont New Ammonia and the move away from the $5 billion 2030 new energy spending target, will Woodside consider a full divestment of Beaumont, and are there planned changes to the Louisiana LNG ownership structure? /

  A: Beaumont is a high-quality operating asset, but market conditions for low-carbon ammonia have shifted meaningfully over the last 12 months, so all strategic options will be evaluated with no pre-determined outcome. For Louisiana LNG, Woodside has already reduced its equity exposure to 57% via partnerships with Stonepeak and Williams, and there are no planned changes to the current project structure as the company continues to seek additional high-quality long-term partners.

• Q: What are the key details of the new single capital allocation framework, and what types of cost savings make up the $350 million 2028 cost-out target? /

  A: The new unified framework requires all capital investments to compete equally to maximize shareholder returns, with full consideration of risk; the full details will be released at the November 2026 Capital Markets Day. The cost-out program includes operating costs, corporate overheads, and sustaining capex savings from a simplified organization, with full sustained savings available starting in 2028.

• Q: Is the Sangamah phase 2 6-8 well program for backfill or expansion, and what is Woodside's current approach to hydrogen and other new energy investments? /

  A: The proposed 6-8 well program is for backfill to maintain high production rates using existing infrastructure, extending the field's productive life with no increase in nameplate capacity. Woodside will continue to explore new energy opportunities including hydrogen, ammonia and CCS, but all investments must meet the same disciplined return hurdles as traditional energy projects and must be supported by actual customer demand and commercial market development.

• Q: How has the Middle East conflict impacted Louisiana LNG supply chains and the sell-down process, and what is the current level of investor interest? /

  A: Louisiana LNG uses a lump-sum turnkey contract with Bechtel, which has successfully mitigated Middle East steel fabrication disruptions via alternative supply routes and alternative fabrication locations, leaving the project on track. There is strong broad interest from potential counterparties for sell-down and off-take, with some near-term focus on short-term supply security amid volatility, and Woodside is being patient to secure high-quality long-term strategic partners.

• Q: What does retiring the Scope 3 and new energy investment target mean for capital allocation going forward? /

  A: Woodside previously targeted $5 billion in new energy investment by 2030, but there is currently no line of sight to enough commercially viable, value-accretive projects to meet that target given slower-than-expected market development. No capital has been reserved for this target on the balance sheet, so there is no immediate change to the company's balance sheet or liquidity position, and new energy opportunities will still be considered only if they meet the unified capital return hurdles.