WDS - Woodside Energy: Climate Becomes An Issue
2024-04-30 11:05:45 ET
Summary
- Woodside Energy plans a major expansion of its LNG production, but major shareholders disagree and rejected the company’s Climate Plan at the 2024 AGM.
- Woodside shareholder action comes at a time when both the courts and governments are getting serious about addressing emissions that are changing the climate.
- Woodside assumes that there's no alternative to expansion of its LNG production at a time when renewables plus battery storage show that they can replace LNG.
- Woodside has a major focus in Asia at a time when LNG expansion is being questioned.
- This is a time for investors to be wary of Woodside’s plans for oil and gas expansion.
The past decade has been an extraordinary time for natural gas/LNG (liquid natural gas) as a power source for electricity generation in the US. Between 2014 and 2023, natural gas has increased from a 28% to 43% contribution (up 15%) to electricity generation. The general takeaway has been that gas has dramatically replaced coal as a power source, and this is true to some extent, with coal down 23% (from 39% to 16%) between 2014 and 2023. Renewable energy has also changed dramatically between 2014 and 2023, up 10% (from 13% to 23%). The story that the oil and gas industry has promoted is that of a switch to cleaner energy from coal to natural gas. This line works if emissions due only to CO2 are considered, but breaks down when methane emissions, which are significant with natural gas/LNG, are included. Globally, natural gas/LNG has enjoyed a similar spectacular growth, due in no small part to Russia invading Ukraine and turning off a major source of European energy. This in turn has impacted emerging Asian LNG markets....
Woodside Energy: Climate Becomes An Issue