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Media Release

Woodside’s climate ‘plan’ full of hot air

17 February 2022

17 February 2022

Reacting to Woodside’s Climate Report released today, Market Forces Asset Management Campaigner Will van de Pol said, “Woodside’s three point ‘plan’ to address its gargantuan scope 3 emissions profile amounts to nothing more than more hot air.”

“Investors must see through the greenwash and demand the company take the only truly effective measure to address scope 3 emissions, which is to manage down gas and oil production in line with the Paris climate goals.”

Market Forces has worked with Woodside shareholders to call on the company to manage down production in line with a net zero emissions by 2050 pathway. The resolution, which will be voted on at the company’s 19 May annual general meeting, follows significant investor support for similar calls at last year’s AGMs, which saw 19% of Woodside shareholders take the extraordinary step of voting for the companies to wind down production and return capital to shareholders.

Woodside plans to spend $5 billion on ‘new energy products and lower-carbon services’. Yet the company has earmarked ~$4 billion in capital expenditure on fossil fuel activities in 2022 alone, with the majority going to Scarborough-Pluto LNG and Sangomar oil – new projects that are incompatible with the Paris Agreement.

The $5 billion commitment includes spending on fossil hydrogen production and carbon capture and storage, and pales in comparison to the total cost of the new Scarborough-Pluto LNG project, which Climate Analytics concludes ‘represents a bet against the world implementing the Paris Agreement’. 

Carbon Tracker states ‘Pluto Train 2 is not competitive even in the [IEA’s 2.7°C warming scenario] STEPS – that is, a world that utterly fails to decarbonise – meaning the deal with BHP is likely going to trigger Woodside to sanction one of its worst assets, increasing risk for its investors.’

Carbon Tracker has also identified the $3.9 billion Sangomar project as the third highest cost oil project sanctioned in 2020 that is incompatible with the IEA’s (net-zero by 2070) Sustainable Development Scenario, let alone a net-zero by 2050 scenario.

“Investors must accept that Woodside’s rampant oil and gas expansion plans are incompatible with the company’s own stated support for the Paris Agreement, and that these plans risk destroying shareholder value along with our chances of a stable climate.”

“One of the few useful pieces of information in the report was the finding that Woodside’s free cash flow would be decimated under the IEA’s Net Zero by 2050 scenario. Woodside’s net zero scenario analysis projects free cash flow to be just ~$250 million per year from 2022-2026, and to remain below Woodside’s 2015-2019 average annual dividend payout for the majority of the next two decades.”