Woodside Energy SWOT and PESTLE Analysis

Strength

1. Stable Performance and Credit Rating: A stable balance sheet and cash flow from underlying operations helped the Woodside at a time when international oil prices are weak. The company had a cash flow from operations of US$3.79 billion during 2021 and paid a dividend of US 135 cents a share overall in 2016 in a year where profit was impacted by new variants of the coronavirus, enforcing new lockdowns and restrictions. However, profit increased by 262% at US$1.62 billion, as the global and Australian economy made a recovery from the impact of the novel coronavirus pandemic in 2020. The company’s credit ratings were reaffirmed at BBB+ and Baa1 by S&P and Moody’s respectively in February 2021, as its net debt has stabilized over the years, down 25.85% from 2017. 2. Exhaustive Risk Management Framework: Being in oil and natural gas sector, risks become inevitable. Woodside’s risk management framework is aligned with ISO 31000 which is the international standard for risk management. The framework covers the fields of Cyber Security Risk, Operational Risk, Loss of Containment Risk, Exploration Risk; Commercial Transaction risk, Commercialization of hydrocarbons risk, Government and regulatory risk, Market risk. The company has collaborated with leading consulting and technology firm Accenture to implement Predictive Analytics for LNG Operations which also enhances the Woodside’s risk management framework.

Weakness

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Opportunity

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Threat

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Political

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Economic

1. Renewable energy to impact conventional energy market: As per New Energy Outlook 2015 released by Bloomberg, around 59% of Australian power will be supplied by renewables by 2040 with the major shift occurring by mid-2030s. This may have a negative impact on oil and natural gas production, but the impact duration is very long. According to government of Australia data, in 2020, 24% of Australia’s total electricity generation was from renewable energy sources, including solar (9%), wind (9%) and hydro (6%). The share of renewables in total electricity generation in 2020 was the highest since levels recorded in the mid-1960s. There is an increasingly aggressive government strategy for encouraging production of clean energy. Hence the threat to oil and natural gas industry is growing immediate. Woodside is also working towards investing in renewable energy projects to adapt to this energy transition better. The remaining section under "Economic" is available only in the "Complete Report" on purchase.

Social

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Technological

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Legal

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Environmental

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