News 01 Oct 2021
The proposed merger between Woodside and BHP’s petroleum business has been described as “company changing” and “transformational”.
|The proposed merger between Woodside and BHP’s petroleum business has been described as “company changing” and “transformational” by our Chief Executive Officer and Managing Director Meg O’Neill and Chairman of the Board Richard Goyder.|
That’s because it represents a unique opportunity for Woodside to significantly increase production, diversify its portfolio and fund multiple growth opportunities, creating a strong foundation for the company’s long-term success.
On completion of the proposed merger, Woodside will become a top 10 global LNG producer.
“It will double our production, double our cash flow and put us in a significantly better position to compete on the global stage,” Meg explains.
As the Chairman noted on 17 August: “We will be the largest energy company listed on the Australian Stock Exchange with a market capitalisation of approximately $41 billion.”
Importantly, the proposed merger also supports Woodside’s role in the energy transition.
“The enlarged portfolio would deliver the cash flow and resilience to fund our evolution through the transition, investing in the right new energy opportunities in support of our aspiration to be net zero by 2050,” Meg notes.
“I’ve often talked about the importance of being low cost and low carbon and the merger sets us up extraordinarily well to compete on both fronts.”
Before the proposed merger is finalised there are a number of steps to be taken, including agreeing final transaction documents, obtaining regulatory approvals and a shareholders’ vote next year.
A joint integration team has been established across the two companies to prepare for the merger, and ensure the proposed merged company is ready for business from Day 1.
Senior Vice President Corporate and Legal Daniel Kalms is leading this integration work for Woodside.
Daniel says a key focus for the integration team will be understanding how the world-class capabilities in both companies can be brought together to create a new entity that is greater than the sum of its parts.
“A measure of our success will be our ability to learn from each other and make sure we are bringing the very best of each company into the new organisation,” Daniel says.
Meg emphasises that while the proposed merger is being worked through, it is vital to concentrate on core business and our imperatives: maintaining safe and reliable operations; achieving targeted final investment for Scarborough and Pluto Train 2; delivering Sangomar Phase 1 Development; and pursuing new energy opportunities for a lower carbon future.
At the same time, work on the new Woodside Transform program (see pages 8-9) is gearing up to ensure a simpler, smarter and stronger Woodside that will thrive into the future.
Naturally, change can bring uncertainty as to what the future holds.
“I do recognise that there is apprehension and uncertainty about the change ahead and that will remain over the next few months as we work through the details of what the proposed new organisation is going to look like,” Meg acknowledges.
“I encourage you to stay keenly focused on what we need to do to stay strong on what we do well today – the four key business priorities – and to stay focused on delivering them.”
Read the Q3 2021 edition of Trunkline here.