Australia’s Woodside Energy Group (ASX:WDS) today issued a clarification on full year 2022 production guidance after confusion reigned yesterday after it appeared that production guidance had been reduced by 4 million barrels of oil equivalent (boe) in yesterday’s trading update.
Woodside is at pains to stress that guidance is unchanged, but apparent decline is due to the application of a standard conversion factor of 5.7mcf/boe as opposed to the previously used ’product specific conversion factor’ said Ashley Kelty, an analyst at Panmure, in a note.
“Woodside also noted that BHP, whose oil and gas assets it acquired in June, previously used the (industry standard) conversion factor of 6mcf/boe. This is clearly bungled messaging from Woodside Investor Relations and Public Relations teams and shows management still have some way to go to understanding markets outside Australia,” said Kelty.
“The 4% slide in the share price will have been a shock to management too,” added the analyst.
Woodside reported yesterday that its full year output, excluding BHP assets, is expected to be between 88 million and 94 million (mmboe), down 4 mmboe from its previous forecast, due to “new conversion factors”, which analysts said was not well explained.