Woodside Energy has announced a strategic shift, suspending its plans to invest in a solar power project in the United States and postponing a final investment decision on a hydrogen initiative. The company intends to refocus its efforts on its core oil and gas operations.
Woodside’s collaboration with solar technology firm Heliogen on Project Capella has come to an end, with both parties agreeing to abandon the project’s construction phase. The Capella project, which was to serve as a demonstration for AI-enabled concentrating solar power technology, had a planned capacity of 5 megawatts (MWe). Despite this, Woodside and Heliogen have stated their intention to continue exploring future opportunities to advance concentrated solar power technologies.
In addition to its solar projects, Woodside is reassessing its hydrogen plans, emphasizing a cautious approach moving forward. The company revealed that it will continue to seek binding offtake agreements before finalizing any investment decisions regarding hydrogen projects. The review includes the recently released 45V Clean Hydrogen Production Tax Credit regulations issued by the U.S. Department of the Treasury in January 2025.
Woodside’s decision aligns with its broader strategy of concentrating on its oil and gas operations, particularly liquefied natural gas (LNG). In its fourth-quarter report for 2024, the company reported a 3% year-on-year increase in revenue, although it was down 6% compared to the previous quarter. The results largely met analyst expectations, with weaker oil earnings offset by strong LNG sales.
The company also provided updates on its major projects. Woodside’s new LNG facility, Scarborough, remains on track for production to begin in 2026. Meanwhile, the Trion oil field project is progressing slowly, with 20% of the facility completed and first oil anticipated in 2028.
In the United States, Woodside is looking to divest stakes in its recently acquired Driftwood LNG facility, which had previously faced operational challenges. Woodside has made it clear that it does not plan to expand into upstream gas operations in the U.S. despite the country’s abundant natural gas resources.
In an interview with the Wall Street Journal, CEO Meg O’Neill explained the company’s reasoning: “One of the things we recognize is that the U.S. is blessed with very significant, high-quality gas resources. That means there’s less imperative to take an upstream position.”
As Woodside navigates this shift in strategy, the company’s emphasis will remain on leveraging its expertise in LNG, with a clear focus on its existing oil and gas ventures rather than diversifying further into renewable energy or hydrogen at this time.
