Woodside Energy Group Ltd (ASX:WDS, LSE:WDS, OTC:WOPEF) has reported a 24% fall in first-half profit as lower oil prices and higher depreciation costs from its new Senegal project weighed on results.
Underlying net profit after tax came in at US$1.25 billion for the six months to June 30, down from US$1.63 billion a year earlier. Analysts had expected the figure, which was in line with consensus forecasts.
Revenue, however, rose 10% to US$6.59 billion, helped by first contributions from the Sangomar oilfield, which began production earlier this year and added nearly US$1 billion in sales.
Market reaction and dividend
Despite the top-line lift, investors focused on the weaker profit outcome. Woodside declared an interim dividend of 53 US cents per share, down from 69 cents a year earlier. Shares were down more than 2.8% in afternoon trade, hovering just above A$26 after 4 pm AEST.
The decline mirrors investor caution across the energy sector, where falling crude benchmarks and persistent cost inflation have limited earnings momentum. Average realised oil prices slipped to US$61.8 per barrel of oil equivalent in the half, compared with US$62.6 a year earlier.
Costs and project impact
Depreciation and amortisation costs climbed sharply, reflecting investment in Sangomar and other major developments. Production costs, depreciation and amortisation for Sangomar totalled US$773 million for the half.
The project has nonetheless emerged as a key growth driver. Alongside stable liquefied natural gas (LNG) output, the project helped lift overall sales volumes and diversify earnings beyond the company’s traditional Australian base.
Strategic moves and guidance
Woodside is continuing to reshape its portfolio. It has already sold a 40% stake in infrastructure tied to its planned US$17.5 billion Louisiana LNG project to Stonepeak for US$5.7 billion and is in discussions with Saudi Aramco over a potential investment and offtake deal.
At home, the company is working with regulators on environmental approvals for extending the North West Shelf LNG venture, where it holds a 33% interest.
Production guidance for 2025 has been narrowed to 188 million–195 million barrels of oil equivalent, slightly lower at the top end after recent divestments.
Broader context
Woodside’s results underscore the challenges facing global oil and gas producers in balancing growth investment with shareholder returns. Lower oil prices have pressured earnings across the industry this year, even as new projects such as Sangomar and strong LNG demand support revenues.
The interim dividend cut reflects a more cautious stance on payouts, though Woodside’s balance sheet remains supported by recent asset sales and strong operating cash flow.
With energy markets still volatile and regulatory scrutiny on LNG expansion intensifying, investors will be watching how Woodside manages its growth pipeline while sustaining returns.