Woodside provides the following information in relation to its Second Quarter 2022 Report, changes to conversion factors, and the impact on reported production and full-year 2022 production guidance.
Woodside confirms that there is no change to the physical product volumes underpinning the full-year 2022 production guidance issued by Woodside in January 2022, which did not include BHP Petroleum (BHPP) production.
There is also no impact on revenue as a result of the change in conversion factors announced in the Second Quarter 2022 Report.
The reduction in the contribution of the pre-merger Woodside assets to full-year 2022 production guidance is solely due to the change in conversion factors. A reconciliation is provided below.
Consistent with common industry practice, Woodside now applies a single volumetric conversion factor when calculating barrels of oil equivalent (boe) for gas products. This consistent methodology applies across the combined portfolio reflecting Woodside’s increased scale and diversified product mix following the merger.
Reconciliation of January 2022 and Second Quarter 2022 Report production guidance
The full-year 2022 production guidance included in the Second Quarter 2022 Report of 145 – 153 million barrels of oil equivalent (MMboe) combines:
- 2022 production guidance for the pre-merger Woodside assets
- 2022 production guidance for the BHPP assets from 1 June 2022, and
- alignment of the conversion factors for the reporting of boe for all gas products.
The comparison of Woodside’s production guidance between January 2022 and in the Second Quarter 2022 Report is:
LNG : Production guidance issued January 2022 (MMboe): 71 – 74 Production guidance issued Q2 2022 (MMboe): 67 – 70
Pipeline gas: Production guidance issued January 2022 (MMboe): 4 – 5 Production guidance issued Q2 2022 (MMboe): 4 – 5
Crude and condensate: Production guidance issued January 2022 (MMboe): 16 – 18 Production guidance issued Q2 2022 (MMboe): 16 – 18
Natural gas liquids (NGLs): Production guidance issued January 2022 (MMboe): ~0.5 Production guidance issued Q2 2022 (MMboe): ~0.6
Woodside excluding BHPP: Production guidance issued January 2022 (MMboe): 92 – 98 Production guidance issued Q2 2022 (MMboe): 88 – 94
LNG and pipeline gas for production and reserves will be reported in boe and calculated from a volumetric basis with a conversion factor of 5,700 standard cubic feet (scf) per boe. BHPP previously used 6,000 scf per boe. NGLs will be reported on a liquid volume basis.
The change has not impacted the previously reported production volumes of LNG in tonnes in the First Quarter 2022 Report. The Second Quarter 2022 Report has restated First Quarter 2022 realised price in boe to reflect the change in conversion factors.