Investors beware: after spending more than $40 million in the Canning Basin, the US-owned company's continued pursuit of remote gas appears to be throwing good money after bad.
Australia's biggest oil and gas producer has posted record production and cut production costs, but weak commodity prices have weighed on profits.
Softer oil and gas prices have dragged on Woodside's full-year bottom-line net profit, which slumped by almost a quarter to $US2.7 billion ($A3.8 billion) despite record production and lower unit costs.
Underlying net profit after tax came in at $US2.6 billion ($A3.7 billion), an eight per cent slip from 2024.
Oil prices tumbled 20 per cent in 2025, their worst year since 2020, due to a global supply glut that the International Energy Agency expects will persist in 2026.
Record production of 198.8 million barrels of oil equivalent and a four per cent reduction in unit costs helped offset lower realised prices over the period, acting chief executive Liz Westcott said on Tuesday.
"In a testament to the strength of our underlying business, during a period of increased capital expenditure and softer prices, we generated free cash flow of $US1.9 million ($2.7 million)," she told analysts in an earnings briefing.
Ms Westcott was optimistic about oil's attractiveness in 2026.
"Oil is a core product for Woodside underpinned by a robust demand outlook," she said.
"The difficulty of decarbonising hard to abate sectors such as heavy transport and petrochemicals means that oil demand is forecast to remain resilient as the world's energy mix evolves."
Ms Westcott is acting for outgoing boss Meg O'Neill, who will become BP's first female leader on April 1.
Woodside has not announced a permanent replacement for Ms O'Neill, but Ms Westcott confirmed the board was assessing several internal and external candidates and expected to make an announcement in the first quarter.
"I know everyone's very interested in the outcome, but I want to reinforce that what I'm interested in and what I know is very important ... is that we continue to execute against our strategy and deliver shareholder value through our disciplined decision making and our operational excellence," she said.
Investors responded warmly to the results, as production topped the upper end of guidance, supporting a 1.4 per cent lift in Woodside shares to $27.48 in early trade.
Woodside declared a final dividend of 59 cents per share, compared with 53 cents the year before.
"The strength of our base business has delivered returns for shareholders, with Woodside having returned approximately $11 billion in dividends since merger completion in 2022," Ms Westcott said.
In project news, the Beaumont New Ammonia project off the US Gulf Coast achieved first production in December 2025, Trion off Mexico remains on target for first oil in 2028, and Scarborough's first LNG cargo should be loaded off the WA coast in 2026.
Investors beware: after spending more than $40 million in the Canning Basin, the US-owned company's continued pursuit of remote gas appears to be throwing good money after bad.
Canadian firm Vermilion judged the chance of the December spill as "rare" - the same probability it claims for seven planned exploration wells that could affect anywhere along the Pilbara coast.
The WA government will soon decide whether Black Mountain Energy can frack 20 wells near the Kimberley's Fitzroy River, but promised measures to protect the environment and the rights of local people are not yet in place.
South West WA's power grid reached a record 91 per cent peak renewable energy share in December - driven by 1,225 MW of new battery storage - while wholesale power prices fell 13 per cent and carbon emissions dropped 15 per cent as coal and gas generation declined.
Peter Milne
Peter Milne
