O'Neill's exit leaves Woodside without its key gas champion

The surprise exit of Woodside Energy Group Ltd Chief Executive Officer Meg O’Neill leaves her successor with a dilemma: should the Australian company continue down the path she set of promoting massive liquefied natural gas projects when forecasts point to a glut and lower prices?

- KEIRA WRIGHT RUTH LIAO STEPHEN STAPCZYNSKI

Ms O'Neill had been a forceful advocate for two major projects: Browse — a long-delayed plan to tap vast offshore reserves in Western Australia — and an expansion of the company’s export terminal in Louisiana, which is still under construction. Her stance reflected a company forecast for a 50% jump in global LNG demand over the next decade, one of the most bullish in the industry.

But with Ms O’Neill now set to helm BP Plc in April, Woodside’s next CEO will need to decide whether to stay the course as a record wave of global LNG supply is poised to flood the market and drag down prices for the rest of the decade. Coupled with a surplus of oil, Woodside will face growing questions from investors about why it is doubling down on fossil-fuel expansion at a time when supply is abundant.

“The board and the new CEO can now rethink the value destructive Browse project, which is more expensive than 70% of competing potential new gas supplies around the world, as well as the expansion of Louisiana LNG,” the Australasian Centre for Corporate Responsibility, or ACCR, said in a statement on Dec 18.

DISCIPLINED APPROACH

At the core of the debate is the future role of natural gas. Ms O'Neill and other industry leaders argue that gas will help coal-dependent nations transition to a cleaner-burning fossil fuel while providing reliable backup for intermittent renewable power.