PERTH (miningweekly.com) – Oil and gas producer Woodside Energy has reported an 86% increase in sales revenue during the fourth quarter ended December, compared with the previous quarter, with revenues reaching A$2.85-billion.

The ASX-listed company said that the average realised price increased by 53% in the same period, to A$90/bl of oil equivalent, with delivered production also up by 2% on the previous quarter, to 22.6-million barrels of oil equivalent (boe).

Sales volumes for the quarter were up 22% on the third quarter, to 31.8-million boe.

“The 86% increase in sales revenue for the quarter was underpinned by a 22% increase in sales volume as well as significantly stronger average realised prices. We achieved our highest quarterly sales revenue on record,” Woodside CEO Meg O’Neill told shareholders.

“The upward trajectory in global oil and gas prices resulted in a portfolio realised price of A$90/bl of oil equivalent and a strong realised liquefied natural gas (LNG) price of A$93/bl of oil equivalent. This increase in realised price demonstrates the continued strong demand for LNG and improvement in the trading environment over the course of 2021.”

During the quarter under review, Woodside also signed a binding share sale agreement for the merger of BHP’s oil and gas portfolio with Woodside.

The merger was first announced in August, and would create a global top 10 independent energy company by production and the largest energy company listed on the ASX.

The combined company will have a high margin oil portfolio, long life LNG assets and the financial resilience to help supply the energy needed for global growth and development over the energy transition.

The merged company would have a diversified production mix of 46% LNG, 29% oil and condensate and 25% domestic gas and liquids, as well as a wide geographic reach with production from Western Australia, east coast Australia, US Gulf of Mexico, and Trinidad and Tobago with approximately 94% of production from Organisation for Economic Cooperation and Development nations. Furthermore, the enlarged Woodside would have 2P reserves of over two-billion barrels of oil equivalent comprising 59% gas, and 41% liquids.

“The merger will deliver increased scale, diversity and resilience to better navigate the energy transition and will provide the financial strength to help fund planned developments in the near-term, invest in future energy opportunities and return value to our shareholders through the cycle,” said O’Neill on Thursday.

“The Australian Competition and Consumer Commission provided informal clearance of the merger in December and clearance from the Committee on Foreign Investment in the US was recently received. This provides momentum towards completion of the merger which is targeted in the second quarter of 2022.

“Final investment decisions were also made to approve the Scarborough and Pluto Train 2 projects in November, including new domestic gas facilities and modifications to Pluto Train 1.

“Scarborough is a world-class resource, a globally competitive project and is amongst the lowest carbon intensity projects for LNG delivered to north Asia. The project is already underway with full notice to proceed issued to key offshore contractors, and early construction works have commenced on the worker accommodation village.”

Meanwhile, Woodside also entered into a sale and purchase agreement with Global Infrastructure Partners for the sale of a 49% non-operating participating interest in the Pluto Train 2 joint venture in November.

This transaction completed earlier this week.

O’Neill pointed out that significant progress was made also made at the Sangomar Field Development Phase 1 in Senegal, with equipment continuing to arrive in the country ahead of the subsea installation campaign scheduled to commence in the second quarter of this year.

“In December, we announced a target to invest A$5-billion in new energy products and lower-carbon services by 2030. This significant investment will position Woodside as an early mover in the new energy market and support the decarbonisation goals of our customers.

“During the quarter, land was secured for two proposed hydrogen and ammonia projects, H2Perth and H2TAS in Australia and the proposed hydrogen project, H2OK in North America. Front-end engineering design commenced on the H2OK project and we signed a memorandum of understanding with two potential hydrogen customers.

“In November, we sold our first carbon offset LNG cargo to Uniper Global Commodities, and our first carbon offset LPG cargo to Vitol Asia.

“Construction of the Pluto-KGP Interconnector pipeline between Pluto LNG and the Karratha Gas Plant was completed ahead of the targeted ready for startup in the first half of 2022 with commissioning currently underway. The Pyxis Hub and Julimar-Brunello Phase 2 tie-back projects achieved ready for startup, with both delivered ahead of schedule and under budget,” she said.

For 2022, Woodside has set a production target of between 92-million and 98-million boe, with the company investing A$3.8-billion to A$4.2-billion on its growth projects.