Good morning, everyone. My name is Richard Goyder, and as Woodside's Chair, I'd like to thank our shareholders, Woodside staff, and guests for attending today's meeting, both in person and online. Before we commence, please take a few seconds to familiarize yourselves with the evacuation procedures shown on the screen, which would apply in the unlikely event of an emergency. Following Woodside's merger last year with BHP's petroleum business, we've evolved into a truly global company. Our headquarters remain right here in Perth on Whadjuk Noongar country. With this in mind, I'd like to acknowledge the Whadjuk people of the Noongar Nation as the traditional owners of the land on which we meet today and pay my respects to elders past, present, and emerging. I recognize their continuing connection to culture and contribution to this city that Woodside is proud to call its home.
The valuable contribution made by the Noongar people in this region of West Australia, conserving and caring for the land on which we live and work every day, is something that I'm personally thankful for, having grown up on Noongar country in the small towns of Tambellup and Broome Hill in the Great Southern of Western Australia. I also recognize the many traditional custodians that protect and preserve the rich cultural heritage in areas where Woodside's operations are located, particularly the Ngarda-Ngarli people as the collective custodians of Murujuga, where Woodside has operated for almost 40 years. As we move towards a referendum on the Voice to Parliament later this year, I also highlight Woodside's strong support for of the Uluru Statement from the Heart and our continued commitment to listen closely to and learn from indigenous voices.
Our annual general meeting is an event that the board looks forward to every year, as it gives us a chance to hear directly from our shareholders and respond to your questions. You'll have an opportunity to ask questions or make comments during formal business. I encourage those shareholders joining us virtually who wish to submit a written question or comment to begin doing so now. This will enable the timely receipt of those questions. You can do so via the same platform that you are already using to view the webcast by following the instructions shown on the slide. Select the Messaging tab, select the category your question relates to, and type your question in the Ask the Question box and select the send arrow.
I'll summarize the process for submitting verbal questions online and for asking questions from the floor before we begin the formal business section of today's meeting. I'm joined on stage this morning by Chief Executive Officer and Managing Director Meg O'Neill and by Company Secretary Warren Baillie. In the room with us are directors, and you might stand as I call out your name. Larry Archibald, Frank Cooper, Swee Chen Goh, Ian Macfarlane, Ann Pickard, Gene Tilbrook, Ben Wyatt, Chris Haynes, Sarah Ryan, Arnaud Breuillac. Also joining us is Angela Minas, who, subject to shareholder approval, will join the board with effect from the conclusion of today's meeting. Arnaud and Angela Minas will introduce themselves to you during the formal business section of today's meeting when they stand for election.
Both bring a wealth of industry, financial, and other relevant experience that will make them valuable members of the Woodside Board. Last month, Chris Haynes and Sarah Ryan announced their retirement as directors of Woodside, and they are standing down from their positions at the conclusion of today's meeting. I'd like to sincerely thank both Chris and Sarah for their outstanding service to the Board and the significant contribution they've made to Woodside's success over the past decade. Thank you both very much. Justin Carroll and Anthony Hodge, representing our auditors, PricewaterhouseCoopers, are also present today. A reminder, as always, that Woodside reports its results in U.S. dollars, and any references to dollars this morning will be in U.S. currency, unless stated otherwise. During today's meeting, we may also make forward-looking statements with respect to various matters, including Woodside's business and operations.
Investors are cautioned not to place undue reliance on any forward-looking statements. Please refer to the cautionary statement and disclaimer wording included in our ASX announcement released earlier today and our annual report and other filings with the ASX, the OSC, and the SEC. On behalf of the Woodside board, I'm pleased to update you on an historic year for Woodside, which saw us complete the merger with BHP's petroleum business, delivered record profit, and become an even more significant supplier of energy to the world. Through our diverse global portfolio, we're providing energy to heat and cool homes, keep the lights on, and support industry in more places than ever, the value of which has been reinforced by events of the past year.
Reflecting on Woodside's significant achievements in 2022, we can see that the benefits of the merger have been immediate. Strong operational performance from our enlarged portfolio allowed us to capitalize on sustained high oil and gas prices across the year. This led to a record annual net profit after tax of $6.5 billion, an increase of 228% on 2021. Importantly, underlying net profit after tax was $5.2 billion, providing us with a strong balance sheet that positions Woodside for major capital investment in future years while returning value to shareholders. Earnings per share more than doubled in 2022 to $4.30, while our total full year dividend of $2.53 per share was an 87% increase on the previous year.
Our maintenance of an 80% payout ratio in 2022 meant that we returned $4.8 billion to shareholders at a full year yield of more than 10%. Our record profit in 2022 also means that we're delivering strong returns through our payments to governments in Australia. Our total Australian tax and royalty payments of AUD 2.7 billion in 2022 demonstrate that when Woodside and our industry performs well, our contribution to government revenue is significant. I'm very proud to chair a company that is delivering these outstanding returns to our shareholders and the broader community while continuing to invest in the oil, gas, and new energy projects that are laying the foundations for Woodside to thrive through the energy transition.
In November 2021, the board took the decision on behalf of our shareholders to invest $12 billion in the Scarborough and Pluto Train 2 projects in Western Australia. Construction of these projects is progressing well, and we're on target for first LNG cargo in 2026. We're only able to make the decision to invest in Scarborough and Pluto Train 2 because of the fiscal and regulatory certainty that Australia has always offered in the past. We'll only be able to make future decisions to invest in both significant new gas projects and new energies such as ammonia and hydrogen that will power our future if that fiscal and regulatory certainty is maintained. Otherwise, we expose our shareholders' capital to unacceptable risk. Internationally, we're making good progress on the Sangomar project offshore Senegal and remain on track to deliver first oil later this year.
We're also working towards readiness for final investment decisions this year on the Trion oil field offshore Mexico and the H2OK hydrogen project in Oklahoma. Meg will provide further details on these major projects and our strong operational performance at producing assets across Woodside's expanded portfolio. On behalf of the board, I'd like to thank the entire Woodside team who delivered these excellent results in 2022. The troubling geopolitical events of the past year and resulting volatility in global energy markets have highlighted the importance of a stable energy transition in which energy is affordable, reliable, and lower carbon. This drives Woodside's strategy to continue building a low cost, lower carbon, resilient, diversified, and profitable portfolio that can provide energy to the world and deliver long-term value for shareholders across different energy transition scenarios.
The projects that we progressed during 2022, which I just mentioned, reflect this diversity of location and product mix. This is also a feature of Woodside's next wave of growth opportunities, including expansion of existing fields in the U.S. Gulf of Mexico, development of major gas fields such as Calypso, Browse, and Sunrise, and execution of new energy and lower carbon opportunities, including hydrogen and ammonia, solar and carbon capture utilization and storage. Through continued development of this diverse portfolio underpinned by consistently strong financial and operational performance, Woodside can maximize our prospects for long-term success against the backdrop of an uncertain energy transition. Our strategy allows us to remain flexible and adaptable to the needs of our customers as they determine their own decarbonization pathways.
We have set out Woodside's assessment of the energy transition and our strategy to successfully navigate it in our 2022 climate report. The report outlines the reasons for the board's confidence in ongoing robust demand for Woodside's products in a lower carbon future. In particular, the important and ongoing role that gas will play in supporting the world's decarbonization goals by replacing coal as a source of power generation, providing firming capacity to support intermittent wind and solar. Throughout the year, we engaged and listened to our shareholders to further understand their expectations about our climate-related strategy and disclosures, and we've taken those into account in preparing this year's report.
While our assessment and strategy remain consistent, we provided additional detail requested by shareholders on how we plan to reduce emissions from our operations, manage our use of carbon credits appropriately, consider future investment options in the context of climate change, and our approach to Scope 3 emissions. The board recognizes the ongoing strong interests of our shareholders in Woodside's climate strategy and tends to put our climate reporting to a non-binding advisory vote of shareholders at our 2024 annual general meeting. Subsequent shareholder votes will be held at three-year intervals unless there are exceptional circumstances. Rest assured, we will continue to proactively engage with shareholders on our reporting and management of climate-related risks and opportunities. Before I hand over to Meg, I'd like to thank her for the outstanding contribution she's made as Chief Executive Officer over the past two years.
Supported by her executive team, Meg's leadership has seen Woodside reach new heights of success. Her ability to drive day-to-day excellence while also providing the vision and inspiration needed for Woodside's long-term success continues to impress those inside and outside the company. My thanks also to my board colleagues, who have provided valuable guidance and counsel throughout what's been a very successful year for Woodside. Finally, to our shareholders, the board greatly appreciates your ongoing support. Just under one year ago, you voted overwhelmingly to endorse our proposed merger with BHP's petroleum business. It was clear you shared the board's view that the merger provided Woodside with a golden opportunity to secure a successful long-term future for our company. 12 months on, there is strong evidence that shows this to be the case.
We're pleased to be delivering you strong returns from a quality and diverse global portfolio while charting a path for Woodside's success through the energy transition that we are confident you will want to be part of. Thank you, and I'll now hand over to Meg O'Neill.
Thank you, Richard. Thank you to our shareholders for attending both in person and online this morning. It is a pleasure to update you on another successful year for Woodside, in which we completed our transformational merger with BHP's petroleum business, delivered record profit and production from our quality global portfolio, further strengthened our balance sheet, and made good progress on our major growth projects. Following the overwhelming shareholder support for the merger at last year's annual general meeting, we worked hard to complete the merger on the 1st of June, and quickly brought together the best of the two businesses together. We put in place our new leadership team, refreshed our culture, and redesigned the organization to operate more efficiently as a global business across multiple time zones. We also listed on the London Stock Exchange and New York Stock Exchange, increasing our access to global capital markets.
Almost one year later, we have evolved into a truly global company with a very strong future ahead. I'm very proud of our teams, who were able to implement this significant change while maintaining excellent financial and operational discipline. Beyond the impressive headline profit numbers, we delivered strong financial returns across the board. Operating revenue increased 142% to $16.8 billion. Free cash flow increased more than six-fold to $6.5 billion. We maintained low levels of net debt and gearing well below our target range. We also achieved the goals we set ourselves ahead of the merger, delivering initiatives expected to realize over $400 million per year of post-merger synergies.
Our excellent financial results were driven by a significant increase in production to 157.7 million barrels of oil equivalent, a result of last year's merger and the strong operational reliability of 98.5% at our LNG facilities. We focused our trading and marketing activities on opportunities that maximized returns from our expanded production. Stepping through our producing assets in more detail. In Western Australia, we achieved steady state operations at the Pyxis and Pluto North sub-sea tiebacks early in the year, adding to production at the Pluto LNG facility. The Greater Western Flank Phase III and Lambert Deep infill projects started up ahead of schedule, helping the Karratha Gas Plant continue to operate at near full production rates in 2022.
A real highlight of the year was the successful startup of the Pluto-KGP interconnector pipeline, resulting in 13 additional LNG cargoes during the year using emerging spare capacity at KGP. The interconnector marks the beginning of a new chapter for our North West Shelf Project as a processor of third-party gas to extend its operating life as legacy fields decline. On the east coast of Australia, Woodside became a significant supplier of gas through our acquisition of a non-operated stake in the Bass Strait Joint Venture. A supply crunch hit this market in mid-2022 due to coal-fired power outages and a drop-off in renewables, Woodside played its part by delivering as many molecules of its Bass Strait gas as possible to customers who needed it.
Internationally, we added more than 20 million barrels of oil equivalent from assets in the U.S. Gulf of Mexico and Trinidad and Tobago, which came into Woodside's production portfolio following the merger. The contribution to our overall production from these assets will increase significantly in 2023 based on a full 12 months of operations. This includes additional volumes from the Mad Dog Phase II project, which commenced production earlier this month. Turning now to our growth projects. The Scarborough and Pluto Train 2 projects combined are now 30% complete and remain on track for first LNG cargo, which is targeted for 2026. Highlights over the past year include the start of fabrication of the offshore production unit top sides, the start of pipeline manufacturing, and completion of the first phase of the Pluto Train 2 construction accommodation village in Karratha.
The 20-year gas sale and purchase agreement with Perdaman that became unconditional this week is a significant milestone. Gas for Perdaman's proposed urea plants would be primarily sourced from Scarborough. This agreement demonstrates the benefits that Scarborough and Pluto Train 2 can bring to Western Australia, in this case, supporting new industry and jobs in the Pilbara region. Of course, the Scarborough and Pluto Train 2 projects themselves will directly create thousands of jobs locally and deliver significant revenue to state and federal Australian governments. We look forward to these benefits really starting to flow across the next couple of years as onshore and offshore construction ramps up. As Richard mentioned, we are expecting first oil later this year at our Sangomar project offshore Senegal.
10 of the planned 23 wells are now complete, and commissioning of the floating production storage and offloading facility is well underway in Singapore. We are targeting FID readiness in 2023 on the Trion oil project offshore Mexico, having completed front-end engineering design activities, issued tender packages for competitive bids, and taken forward regulatory approval submissions. In our new energy business, we're making excellent progress on the H2OK hydrogen project in Oklahoma. We completed front-end engineering design in 2022, and late last year awarded contracts for electrolysers and liquefaction units to be installed at the facility. This has positioned us well for FID readiness this year. Also this year, we are targeting a final investment decision at our Woodside Solar Project in the Pilbara, which could make an important contribution to our plans to decarbonize the Pluto LNG operations.
This facility could supply 100 MQ of solar energy to Pluto LNG and other customers located near Karratha, with potential expansion to a maximum of 500 MW. The global energy security and affordability crises that unfolded in 2022 highlighted the challenge we all face as we strive to maintain and improve global standards of living while reducing our emissions. While there is considerable uncertainty over how the energy transition may unfold in the decades ahead, we can be confident that global energy demand will continue to grow as the more than one billion people without access to reliable and affordable energy pursue the same quality of life that we in Australia enjoy. That demand, and the role gas can play as a lower carbon source of energy the world needs, underpins our confidence in the long-term strength of our business.
As I outlined in my speech to the National Press Club last week, the natural gas produced by Woodside can support three important interrelated goals. First off, providing affordable and reliable energy for Australians. Secondly, maintaining strategic partnerships and energy security in our region. Third, progressing global decarbonization. Gas is not the only answer to achieve these goals, but it is, and will continue to be, an essential part of the equation. At home, gas is a flexible source of energy that provides stable baseload power generation, smooths the transition to renewables, and is an enabler for industry and manufacturing. Abroad, by generating electricity with around half the life cycle emissions of coal, gas is helping to keep the lights on in the mega cities of our most important regional partners, while also supporting their national decarbonization goals.
This essential ongoing role for gas in the energy mix is why Woodside continues to engage with the Australian government on policies that support affordable and reliable energy for households and business while supporting continued investment in new gas supply and infrastructure. If we don't get these settings right, there is a real risk that energy development will stall and Australia will miss out on the benefits, not only in terms of energy supply and economic development, but also the scale and pace of our renewable ambition. As Woodside takes forward our growth opportunities, we do so in line with the commitments under our climate strategy to reduce our net equity Scope 1 and 2 emissions, and to invest in the new energy products and lower carbon services that our customers require to secure their energy needs and reduce their emissions.
As set out in the 2022 climate reports, we are on track to meet our 2025 and 2030 emissions reduction targets of 15% and 30% respectively towards an aspiration of net zero by 2050 or sooner. In 2022, Woodside's net equity Scope 1 and 2 greenhouse gas emissions were 11% below the starting base, which was adjusted following the merger with BHP's petroleum business. Methane emissions were around 0.1% of our production by volume. During 2022, Woodside became a signatory to the Aiming for Zero Methane Emissions initiative. At the core of Woodside Scope 3 emissions strategy is our target to invest $5 billion in new energy products and lower carbon services by 2030. We have to date, spent more than $100 million in this area, primarily on our H2OK project.
During 2022, we supported a number of initiatives to promote emissions reductions by our customers and suppliers and to enhance global measurement and reporting of Scope 3 emissions. Climate change is one of many considerations that drives our commitment to strong environmental, social, and governance performance. As our business continues to evolve, so do our ESG focus areas, and we will adapt accordingly through our approach to sustainability and reporting. The health and safety of our people is our highest priority, and it was very pleasing that across our global business in 2022, we recorded no Tier 1 loss of primary containment process safety events. Although we did record one low-risk Tier 2 event. Our injury performance, however, continues to be challenged. Our total recordable injury rate of 1.80 per million hours worked remains above our target of 1.0.
We know we need to improve. We are making progress. Our focus is on safety culture, leadership, and applying human and organizational performance principles to help us learn and return to leading safety performance. Partnering with First Nations communities to create positive outcomes that leave a lasting legacy also remains one of Woodside's priorities. Highlights for the year included successful negotiations with the Ngarluma Aboriginal Corporation for an indigenous land use agreement to support the proposed Woodside Solar Project. Approval of the Scarborough Project Cultural Heritage Management Plan following extensive consultation with traditional custodians. We continued to fund air monitoring on the Burrup Peninsula in support of the Murujuga Rock Art strategy. We provide support for Murujuga's World Heritage listing. As Richard mentioned earlier, Woodside has an enduring commitment to listen closely to and learn from indigenous voices.
In this spirit, we have publicly declared Woodside support for recognizing Indigenous Australians in the Constitution and establishing a Voice. Yesterday, we announced that we have appointed Liz Westcott as Executive Vice President, Australian Operations. Liz had a distinguished 25-year career at ExxonMobil, working in Australia, the United Kingdom, and Italy before joining EnergyAustralia in 2018, where her most recent role was Chief Operating Officer. I'm delighted that Liz is joining Woodside. Her extensive upstream experience is complemented by knowledge of the power generation and retail sectors. I would also like to thank Mike Price for his leadership of the Australian operations team over the past five months. Before I hand back to Richard, I would like to echo his appreciation for our shareholders and for your support of the strategy that Woodside's board and executive leadership team are implementing.
The faith you showed in backing last year's merger has already been rewarded with financial strength, operational excellence, and the attractive growth opportunities we have outlined today. The opportunity in front of us is to springboard off a very successful 2022 and take Woodside's future prospects to that next level. Building a company that will thrive through the energy transition and deliver value to you, our shareholders, for many years to come. Thank you.
Well, thank you, Meg. We'll now move to the formal business of the meeting. There are six items on the agenda today. Item one is a discussion of the 2022 financial statements and reports. Item two is the re-election of three directors retiring by rotation and the election of two new directors. Item three is consideration of the company's 2022 remuneration report. Item four is the grant of equity incentive scheme awards to the CEO and managing director. Item five is consideration of non-executive director remuneration. Item six, resolutions requisitioned by shareholders. General questions and comments about the accounts and the management of the company will be addressed during item one, along with any questions to the auditor. Questions on each of the other agenda general items will be addressed when we reach those items later in the meeting.
As this is a shareholders' meeting, only shareholders, their attorneys, proxies, and authorized company representatives are entitled to speak and vote at this meeting. Please direct all questions to me as Chair. Today is an important opportunity for the broad range of Woodside shareholders to ask Meg and me questions on the issues of interest to you. We want to hear from as many shareholders as possible and not have proceedings dominated by questions from any one group. I ask that you keep your questions brief and avoid repeating issues that have already been covered. Could you please ask no more than two questions at a time to give all shareholders an opportunity to be heard. I remind shareholders that questions must relate to the item of business under consideration as.
As in previous years, no speeches, please. When I invite questions later in the meeting on each item, we'll take questions from the floor from shareholders and proxies who are in attendance, written questions submitted through the online platform, and audio questions submitted online. Shareholders who wish to ask questions from the floor will be called to approach our staff positioned by microphones in the aisles at the appropriate time and show them your handset. Please give them your name and required details, and they will introduce you to the meeting. I've previously outlined the arrangements for submitting written questions online. These are again shown on the left-hand side of the slide as a reminder. Questions submitted online may be grouped together if there are multiple questions on the same topic. The process for submitting audio questions online is on the right-hand side of the slide.
Click on the Request to speak button at the bottom of the broadcast window, enter the required details, click Submit Request, and follow the audio prompts to connect. You will continue to hear the meeting while you wait to ask your question. Voting today will be conducted by poll. Each shareholder present in person or by proxy has one vote for every ordinary share owned. Lisa Ahwan from the company's share registry Computershare has agreed to act as Returning Officer for the polls. The polls will be scrutinized by representatives from PwC, the company's auditors. I'll open the poll now for voting on all items of business so that shareholders who aren't able to stay for the full meeting can still cast their votes on all items of business. For shareholders attending in person, we're using electronic keypads instead of paper poll cards.
This means we'll be able to share the provisional voting results with you towards the end of the meeting. Instructions for using the handsets and submitting your votes on each item are now on the screen. Please take a moment to familiarize yourself with these. At the time of registration, shareholders who are eligible to vote would have been given a white plastic smart card and a handset. Proxy holders would also have been given a handset and a summary of their voting instructions. Following the discussions on items of business, I'll prompt those shareholders who are physically present to vote on those items at that time. Your handset will activate, and your voting instructions will appear on your screen. If you require assistance now or during the voting, please simply raise your hand and someone from the Computershare team will come and assist you.
For shareholders requiring assistance online, please follow the instructions on the online platform to access assistance on voting. Voting will remain open during the discussion of the items of business. I'll let you know prior to the close of the poll. Shortly after the close of the poll, the provisional poll results will appear on the screen behind me. The final results of the polls will be announced after the meeting to the Australian Securities Exchange, the London Stock Exchange, and the New York Stock Exchange, and will also be available on Woodside's website. I'm holding open proxies in my capacity as Chair of the meeting, and it's my intention to vote all available proxies in favor of the resolutions in items two to five and against the resolutions in item six, which are not endorsed by the board. Oops.
I move now to item one, which is the financial statements and reports. The first item of business on the agenda is to receive and consider the company's financial report and the reports of the directors and the auditor for the year ended 31 December 2022. Although voting is not required on this item, shareholders have the opportunity to raise questions or comments relating to the management of the company and the reports. We'll address any questions or comments on the 2022 financial reports of the directors and the auditor, including general questions on the management of Woodside. If you have a question that relates to the subsequent items, item of business, please hold off on raising that question until we reach the relevant item, sorry. A reminder that you can log questions online at any time.
We'll hold off on raising those related to a particular item of business until we are at the point of considering that item. Again, I request that you please ask no more than two questions at a time to give all shareholders that opportunity to be heard. We'll now address any questions on or comments on Item one, including general questions received, starting with questions received from shareholders prior to the meeting. Can the operator please call out the written questions received? Nothing?
Number three.
I've just gone to the operator. Nothing, no written requests from the operator? I'll come back. I'll go to microphone three.
Thank you, Mr. Chair. We have Mr. Chris Schott. He is a shareholder. Please ask your question.
Thank you. I've only been a shareholder since the merger with BHP Petroleum, so I got the shares issued. This is my first AGM of Woodside. I have to say, Mr. Goyder, as a person who've come from Adelaide for this meeting, I appreciate you very much enjoyed the great football festival in Adelaide 10 days ago, which proved that Adelaide is as much the center of Australian rules football as is Melbourne, and may be equal with Perth. My, I have two specific questions on the management. I will ask other questions on the remuneration report, and questions on speaking on item six and on the election of directors. My two questions. In the annual report, you mention you're doing business in China and you're doing business in Burma.
Let me deal with China first. Do you agree with the assessment in the ASIO report that China is a material threat to Australia? If so, what are you advising the Australian government they should do regarding the business that you do in China and the risk that that business may be curtailed if, unfortunately, any form of hostilities over Taiwan break out? Second question is with Burma. Way back in 1989, I had the good fortune to meet Aung San Suu Kyi, the then democracy leader in Burma. Since that time, over 30 years, she spent about 30 years either in jail or in house arrest. She is under house arrest at jail now, threatened with a long sentence by the military regime that took over.
What I am very concerned about is that the money we may pay to Burma to be active there in royalties or whatever. It won't be used to improve the living standards of ordinary Burmese people. It'll overwhelmingly be used for the army to get weapons, et cetera, to continue to suppress the ordinary people of Burma. Aung San Suu Kyi, the last time there was a reasonable election, she got 75% of the Burmese vote, and yet she's been locked up. I want an understanding that, one, I think you should withdraw from doing business in Burma until some form of reasonable democracy and human rights are restored. They're my two questions, one on China and one on Burma.
Thanks, Mr. Schott. I hope you got to at least some of the games. I got to nine games in Adelaide the weekend before last. It did a superb job. South Australia did a superb job. I'll quickly respond. I'll get Meg to respond in detail. The second part of your question on Burma, we've withdrawn in almost every aspect from Burma, but there are some residual issues around some employees that we're ensuring we protect them. I'll get Meg to give you the precise response on Burma. We've been out of Burma now for some time, I think probably two years, Meg. On China, I'm not gonna comment on the geopolitical situation, government to government. Meg can clarify this. We have a long-standing contract with a customer in China that has been long-standing.
As a board, we look carefully at all risks that we can manage and risks that may be more difficult to manage. Clearly, we look at potential country risks and things like that as we manage the business. Things that may impact our sales and revenue, we look at how we best manage those risks, but I don't want to get into detail about the geopolitical. Meg, can you just talk a bit about the contracts in China and how we've exited from Burma?
Sure. Thanks. Thanks, Richard. Thanks for the questions, Mr. Schott. When it comes to China, we've got business in probably three different dimensions. We have a very significant LNG sales contract with a Chinese customer. That customer has been a very reliable customer. They're a co-investor in North West Shelf with a small equity stake there. We construct facilities in China. We constructed the Sangomar floating production storage and offloading facility there. It's now been moved to Singapore. We're also constructing the Scarborough floating production unit there. Of course, like many businesses, we have a supply chain that has many parts and elements that come through China. Look, we have very close relationships with the Australian government.
We work very closely with them to understand the state of the relationship and the potential risks in that relationship. We do extensive scenario modeling, as Richard described. We look at all of the risks in our business, and at this point in time, we're still quite comfortable with executing those business activities in China. When it comes to Myanmar, we entered that country as an explorer when democracy first took hold, and that was when the democratic process was really showing signs of hope. Our exploration process, we drilled a number of wells there. We had a discovery. We were optimistically trying to progress the development. When the coup happened in 2021, we ceased all activities, and we announced to market last year that we were pursuing a withdrawal.
The withdrawal, as Richard noted, has some complexities to it. We're making sure that we exit in an orderly manner, but we are exiting our business in Myanmar.
About two questions, but one question about China. How much of the revenue of Woodside, it comes from what we sell China in both billions and a percentage of our total turnover?
Yeah, we don't talk about the revenue that comes from specific customers.
What?
Microphone one.
Mr. Chair, I'd like to introduce Mr. Geoff Read, representing the Australian Shareholders Association.
Thank you. Good morning, Chairman.
Morning, Geoff.
My name is Geoff Read. I'm representing over 1,000 members of the Australian Shareholders Association who have given me their proxies, which in total amount to 2.3 million shares, which if it was one block of shares, would put us comfortably inside the top 20 shareholders. Mr. Chairman, I have two questions for you today, I would propose to ask them both at once, if that's okay with you.
Yeah.
Thank you. Number one, you said in the annual report that you're considering selling stakes in the Scarborough development and the Sangomar development to other parties. My question is, now that we've got the BHP merger bedded down, are you still considering selling stakes in those operations? If you don't sell a stake in them, can you fund the developments from internal sources, or will you have to go to the market for funds? Number two, in the U.S.A., the Inflation Reduction Act commits trillions of dollars to clean energy. What opportunities does this provide to Woodside, please?
Thanks, Mr. Geoff Reed. Geoff, thank you for the opportunity to engage with you as representative of the Australian Shareholders Association and the constructive dialogue that we continue to have with you. Congratulations on the way you represent them. I'm gonna get Meg O'Neill to respond to both Scarborough and Sangomar and the Inflation Reduction Act.
Mm-hmm.
What I will say is, from a Board point of view, one of the things we take very seriously and we spend a lot of time on is our capital management plan to ensure that under almost any circumstance we've got the capacity to fund commitments that we've made. As a Board, that's a very top issue that we focus on. We are confident about our capacity to fund the projects that we've already announced and indeed some of the ones that we expect to announce in coming period of time. I'll get Meg to talk more specifically about where we are with Scarborough and Sangomar sell-down and the Inflation Reduction Act opportunities in the U.S.
Well, thanks for the question, Mr. Reed. We were pursuing a sell-down of Sangomar. Just for everyone's benefit, we hold 82% in operatorship. Our partner with 18% is the national oil company, PETROSEN. For a period of time last year, we were pursuing a sell-down. The objective of the sell-down was to bring in a high quality partner at a price that was value accretive for Woodside shareholders, and we were unable to get that kind of partner. We've stopped the sell-down of Sangomar, and we're proceeding with our 82%. Very pleased with how the project is going. With the Scarborough project, so with the merger with BHP Petroleum, we now hold 100% of the offshore.
It's probably also worth reminding the shareholders that we did complete the sale of 49% of Pluto Train 2. We have a co-investor in the train, but the offshore asset, we still hold 100% following the merger. We are looking for a partner, but again, with the strength of the balance sheet following the merger, we're very much focused on bringing in a high quality partner at a price that is value accretive for Woodside shareholders. We're being pretty patient in the sell-down process. If we can find the right partner, we'd be happy to bring them on board. If we can't, we do have the balance sheet capacity to continue to fund at 100%.
With respect to the Inflation Reduction Act, I don't know if you heard my speech at the National Press Club, but I flagged this as a game changer. It is a tremendous opportunity, and it will transform the investment opportunities in the U.S., particularly in these new energy commodities, things like hydrogen and CCUS. The U.S. government has done a couple of really kind of fantastic things with the IRA. First off, it's really emphasizing carrots. There's an opportunity for many investors to pursue these opportunities for things like hydrogen production, very attractive, very meaningful incentives for hydrogen producers. Our H2 Oklahoma project was looking quite attractive even before this. The IRA makes it even more compelling. We are looking at opportunities.
We've been working on some carbon capture and sequestration opportunities in Australia. With the IRA, we're going to start looking at those sorts of opportunities in the U.S. I'm very excited about what the IRA means for our business and the opportunities we might have in the future.
Thank you very much.
Thanks, Geoff. Microphone two. T hen I'll go to four.
Thank you, Mr. Chair. We have here, Mr. Trevor Gibb. Mr. Gibb is a shareholder.
Good morning, Richard. I'm a representative of Surf Life Saving. I'd just like to thank the board and Woodside in particular, regards the ongoing sponsorship with Surf Life Saving for the Nipper program. I presume it's gonna be ongoing. Is that right, Richard? Please.
It falls within the CEO's authorities, I think, Trevor. It's a program that we're actually really proud of because it does amazing things for our kids and for the safety of people swimming in West Australia. We're really proud to be associated with Surf Life Saving, and I appreciate your comments. Thank you.
Mm-hmm.
No, I'd like to thank, it's definitely a program that's lifted the profile of the Nippers program, definitely having Woodside on board.
Mm-hmm.
Thank you.
Thank you. Thanks, Trevor. Microphone four.
Mr. Chair, this is Josh Kirkman, who's a proxy representing Mrs. Christine Cook and Dr. Peter Cook.
Hi, thank you. First off, thank you for your support of the Voice to Parliament referendum this year. It's really commendable, the country needs it. To the chairman, a study released last week by Climate Energy Finance concludes that Woodside faces up to a $63 billion liability to 2050 for the Burrup Hub group of projects under the reformed Australian Safeguard Mechanism policy. The Browse development in particular carries significant additional costs due to the need to pay for every ton of CO2 equivalent. How has the board factored in the mounting costs from climate regulations such as the Safeguard Mechanism, will it now reassess the development of Browse in light of this? Thank you.
Yeah. Thanks, Mr. Kirkland, for your question and comment on The Voice. I'll get Meg to answer in detail. All I'd say is starting is that we apply cost of carbon to all the decisions we make where that is appropriate, and the board clearly looks at the risk associated with that risk and any, and others associated with any investment. Meg, do you wanna go into any more detail?
Sure. Thank you for the question, Mr. Kirkland. We've looked at that report. We're not entirely sure how the math was done on those calculations. We model our emissions in every investment decision we make. As Richard said, we apply a cost of carbon. It's actually well in excess of the carbon price that was noted in the reformed SGM, which is AUD 75. We use $80 to inform our decision-making. So as we, you know, run the forward economics of investment opportunities like Scarborough and Browse, it is inclusive of a cost of carbon. You know, one of the things that we've been talking about and we've been working on the last couple of years for Browse, specifically is a carbon capture and sequestration solution.
We recognize that with Browse's reservoir CO₂, you know, we need to make sure that we are progressing opportunities to reduce the carbon impact from day one, and that's underpinned much of our work. We still view Browse as an attractive opportunity even with the reformed Safeguard Mechanism.
Thank you.
Microphone three. I'll just give the operators a heads-up. We'll go to any online questions and/or verbal questions next.
Mr. Chair, I have Ms. Lara Samson. She is a proxy holder representing Mr. Andrew Nielsen.
Good morning. Mr. Goyder, your introductory message in the climate report says that Woodside has explained what it can, but also what it cannot do. Presumably, this is a reference to setting Scope 3 targets among other things. Why is it that BP, Equinor, Repsol, Eni, Shell, and even Chevron can set Scope 3 targets, but Woodside can't?
Thank you, Ms. Samson for the questions. We actually do have a Scope 3 target, which is to invest up to $5 billion.
Mm-hmm
... Projects to support our customers with lower emissions, energy. I'd also make the point that our Scope 3 emissions are our customers' Scope 1 emissions. I think all of our customers, Meg, are in countries that have either net zero by 2050 or in China's case, 2060.
Mm-hmm
... Commitments. Those customers are all in countries that have got the same sort of commitment that Australia has or a similar commitment that Australia has to reduce emissions.
Mm-hmm.
We'll work with our customers to reduce their emissions, but it's their Scope 1 emissions, that is their responsibility. Do you wanna add anything?
No, that's a good answer.
Thank you.
Mm-hmm.
Are there any audio questions online?
We've got online as well.
There's online. Go on.
Mr. Chairman, we have an online written question from Miss Athena Pizoli. Does Woodside have a plan B in the event that the current climate debate casts strong doubt in the claim that global warming is real? Many thousands of scientists are providing much data, all of which point to no global warming over the last 20 years. Plan B would mean that Woodside does not abandon its unrepeatable oil and gas assets portfolio. Oil and gas are crucial to Australia's sovereignty.
Thank you for the question. Can I be really clear that we actually agree with the science on climate change.
Mm-hmm.
We agree that there's that the climate is changing and that there's causes for that. We are strong supporters of the energy transition, and we want to be a.
Mm-hmm
... Player in the energy transition. It makes the rest of that questions, less relevant. What I would say, and what you've heard this morning is, we are making significant investments in our existing portfolio of assets, as well as, hopefully investments in new energies that give Woodside the opportunity to be a significant player through the energy transition.
Mm-hmm.
Understanding that there are many customers in many parts of the world who will need our oil and gas for, we think, decades ahead.
Yeah. Perhaps the one point I could elaborate on that is fully concur with Richard's comments about we do support that the science is real and that the world needs to adapt, and we need to make changes to limit the potential negative impact of global warming. That said, there are many possible pathways to achieving that outcome. If you look at the IPCC report, there are something like 200 pathways that are what we've called broadly Paris compliance. The variability is very wide. So as we think about our investment decisions and we think about the opportunities that we're pursuing, we wanna make sure we stress test those decisions against a range of possible scenarios.
That is pretty well articulated in our climate report. I think it's important to note that there is uncertainty as to how the world will evolve to respond to climate change.
Thanks, Meg. Any others online?
Mr. Chair, we have a written online question from Catherine Holdcroft. The question is: If we are making such a big profit, why don't we pay tax?
The answer is, we do. I think I said that in my opening speech, that last year we paid AUD 2.7 billion in taxes and royalties.
We're a very significant taxpayer. I think an important statistic to note, last year our profit went up 200%, our tax paid went up 300%. Now there's some technicalities. Some of that tax, in fact, much of that tax is paid through entities that are subservient. If you look at the total tax bill, and our treasurer is happy to kind of report on the checks that we send out, AUD 2.7 billion in Australian tax and royalties, and that's both at Commonwealth and state levels. A very significant tax contribution. Within the Australian framework, we pay a number of different taxes, and it's not just. It's important to note, we don't pay just corporate income tax, we also pay a petroleum resource rent tax.
We are a very significant payer of petroleum resource rent tax following the merger with BHP's petroleum business. The bill for that alone was $720 million last year. That's only with 7%, or sorry, seven months contribution from the BHP petroleum assets. We do pay our way.
Meg, correct me if I'm wrong on this. We pay a 30% corporations tax in Australia, the PRRT is 46% on certain profits. We could be paying up to 58% of our profits
Correct.
In tax.
On certain projects.
On certain projects. Which is a pretty material component of the cash life.
Correct.
I'll go to microphone three in the room.
Thank you, Mr. Chair. I have, Mr. Alex Hillman. Mr. Hillman is a shareholder.
Good morning, Mr. Goyder, Meg . Some of the questions about Trion. You're targeting an FID or FID readiness for Trion later this year. It's a Gulf of Mexico oil project for those who aren't aware. Your capital allocation framework says that for oil projects, you expect to generate 15% return. Based off KPMG's independent expert report and our analysis of that, it doesn't look like Trion meets this hurdle rate, and that's before considering a range of risks, such as partnering with Pemex, a state-owned oil company which has a poor financial and safety record and has faced serious corruption allegations. How do you consider these projects and country-specific risks when considering this 15% hurdle rate across your portfolio?
Thanks, Mr. Hillman, for the question. I wouldn't put too much store in any evaluation other than the evaluation we'll do, which we are currently doing, and we'll take into account all the risks, some of which you've raised and some other risks. It'll to make final investment decision approval on Trion, it will want to make a return in line with our capital allocation framework. We assess the risks around country and partners as well in any evaluation we do.
Mm-hmm.
Do you wanna add anything?
Yeah. Perhaps I can add a point around Pemex as a partner. Pemex actually has been a fantastic partner for us, and I think it's worth noting that in the context of historic poor practices or corrupt practices, the way the Mexican government has managed the Trion process from the very first licensing step all the way through today, has been one of the highest level of transparency. The bid was conducted in an extraordinarily transparent manner, where bidders were submitting bids in a clear plastic box, and they were read out on public TV. Mexico does recognize that the history is challenged. The new CEO is very committed to improving their ESG performance and their safety performance. There's a great desire to collaborate with international investors on that goal.
He's also very committed to tackling some of the historic issues around inappropriate business practices. We've found Pemex to be actually a very valuable partner, bringing good insight into how to operate in Mexico, bringing tremendous human capability. We look forward to continuing to work with them on progressing a development that we think will meet our investment targets. Pleased you've read closely, 15%, five-year payback is what we're shooting for.
The crux of the question now is there's a specific risk profile for Trion which is not representative of the average oil project. I expect you're not gonna challenge that. How would your investment investment framework adjust for project-specific risks when you, when the framework is around a portfolio hurdle rate?
Every project investment decision we make, we look at a range of risks, we run what we call a tornado of economic scenarios where we test, you know, what happens if this scenario happens? What happens if this other thing might happen? If there's a cost increase, if there's a cost decrease, if we get more reserves, if we have less reserves. We run all of these cases, we make the business decision in the totality of that information. Country risk is something that's factored in. That's one of the key risks that we look at.
Just wrapping it up. If, if you don't make an FID entry on, would you expect to see greater shareholder returns via dividends, or buybacks?
I mean, our dividend policy is to pay between 50% and 80%.
Mm-hmm.
Profits after tax. That won't change whether we do Trion or H2OK or...
Mm-hmm.
-Or anything. The board, as I said earlier to a question from Geoff Read, the board looks very carefully at our balance sheet, but that return framework won't change. Thank you.
Thank you.
Microphone two.
Mr. Chair, we have Mr. Martin Dickie, and Mr. Dickie is a shareholder.
Thank you very much, Mr. Chairman, for your report. I'm pleased to read that Woodside has a new energy strategy. As a Perth resident, I'm interested in the operations of H2Perth. As I understand it, natural gas is broken down by heat into hydrogen, carbon monoxide, and a small amount of CO2. The carbon monoxide is reacted with water to produce more hydrogen and more CO2. The figures that I found in a Forbes report of 2020 state that for a kilogram of hydrogen produced, 9.3 kg of CO2 would result. In energy terms, 0.28 kg of CO2 for every kilowatt-hour of hydrogen. Given this calculation does not address emissions that result from the use of the hydrogen, how does reliance on this process help with the company's plans to balance its CO2 emissions?
Yeah. Thank you for your question. Meg, I'm gonna pass that one to you.
Yeah, look, it's quite a technical question, and happy to lean into the details with you offline. I think at a high level, perhaps the best way to answer the question with our H2Perth opportunity, we're looking at two different methods of producing the hydrogen. One is a method that uses gas as a feedstock, which is the method that you're describing. Our commitments with all of our new energy projects is that we are Scope 1 and 2 net zero from day one With an opportunity like H2Perth, that will mean either using carbon capture and sequestration, and that may be sequential with starting up the project, or potentially using offsets in for a particular period to bridge the gap.
We are also looking at opportunities with H2Perth to use straight up electrolysis, which is the process of taking a water molecule and cracking that and then using the hydrogen atom itself to produce hydrogen and liquefaction. You may have seen, Mr. Dickie, that we made an announcement earlier this week about signing an MOU with Keppel Data Centres for liquid hydrogen supply. There's opportunities in both of those methodologies to produce the hydrogen. We'll want to work with our customers to find the opportunity that best meets their needs when they look at the totality, the cost, the carbon emissions, and the reliability. Probably the fourth factor is timing of offtake. We'll be looking at all of those items.
Thank you for that. My second question relates, is similar. It relates to your proposals for ammonia production, which appears to be a sound investment, given the need to produce more food from less land in the near and medium future. However, production from LNG appears to be an energy-intensive and dirty process that results in large CO2 emissions, which are the last thing that a company wants to take on at this time. What is the strategy for dealing with this fresh source of emissions?
Maybe I'll go back to our overall investment framework. Our strategy as a company is to thrive through the energy transition. When we look at the energy demand profile globally and then also, of our customer countries, which are largely today in Asia, we see continued demand for gas as those nations seek to diversify their energy mix and decarbonize their energy mix. It's worth noting that Japan, Korea, China, all still have heavy reliance on coal, and as they progress towards their net zero goals, which are 2050 and 2060 for China, they've been very clear with us that they're going to need more gas. LNG is energy intensive to produce here if you compared it to pipeline gas, for example.
When you look at the total lifecycle emissions, it is still about half the emissions intensity of coal. We continue to believe that LNG has a very bright future for decades to come. Ammonia's an interesting commodity that we're looking at, the use case that we are investigating is for customers in those same countries. As they think about decarbonizing their coal-fired power generation, they're looking at the feasibility of blending ammonia into those boilers. Using ammonia allows them to get the same power output for lower emissions intensity. That's the business opportunity that we're pursuing with the ammonia opportunities. Again, ammonia's think of it as a different way of carrying the hydrogen molecule.
All right. Thank you. Thank you very much.
I'm just gonna go to an online audio question.
Mr. Chair, our online audio question comes from Reuters Nominees PTY Limited. Please go ahead after the beep.
Hi there. I see on your balance sheet that you have a decommissioning allocation of $4 billion. Considering the amount of assets that Woodside now holds, does that seem sufficient to carry this liability?
We obviously pay a lot of attention to any of these liabilities, and our provisions are based on, and restoration estimates are based on compliance with relevant regulations in different jurisdictions.
Mm-hmm.
We, yeah, absolutely, report in accordance with our obligations on that. I can tell you as a board, we've approved some significant sums of money in the last 12 months.
Mm-hmm.
For rehabilitation obligations we've got, and, we are
Mm-hmm.
Completing a whole lot of those, in the coming year, including some work to be done in Bass Strait.
Mm-hmm.
Anything else, Meg?
No.
Okay. I think there's a couple more written questions.
Yes, Mr. Chair. We have a written question from Dr. Diana Lynn Sainsbury and Mr. Peter Jeffrey Sainsbury. The question is: In Ms. O'Neill's opening remarks, she argued that gas plays an important role for baseload power generation and load balancing. In the 2022 climate report, Woodside uses the Australian National Electricity Market as a case study of those dynamics. Could you please clarify how important the NEM is to Woodside's gas business today, and why was that chosen as a case study?
Meg?
Sure. As I noted in my remarks, following the merger with BHP's petroleum business, we are now a significant supplier of gas in the East Coast Australia market, also known as the National Electricity Market or the NEM. We provide about 40% of the gas in Victoria and about 20% of the gas in New South Wales. We used that as a case study to illustrate the point and to illustrate a couple of things. If you look at South Australia, for example, South Australia has been very successful in deployments of renewables, but gas continues to be a very noteworthy portion of their energy mix to provide that firming capacity and to complement the investment in renewables. When you look at other sections or other states, there's still a very heavy reliance on coal.
I think this is a great example of a couple of things. In South Australia, you see how gas is the natural partner for renewables, the lowest emissions intensity choice. Then in the other states, we see the opportunity that's created for gas. Now, as you note, and you see in our business, the Bass Strait business is an important element of our company. Given the new size of Woodside, it's one of many important parts of the business.
Thank you. Can we go to the other online question, please?
Mr. Chair, our online question comes from Catherine Holdcroft. As a shareholder, I have read the latest Woodside climate report and commend the acknowledgement of climate emergency. It is not clear to me how the company is going to effectively address their responsibilities. I'm worried about the vague use of carbon capture and carbon sinks, which seem to create excuses to keep up fossil fuel production and are unreliable and an excuse to keep doing what we are doing. 2050 is too late. IPCC says no new fossil fuel activity. Does Woodside aim to achieve that? Can't Woodside be a leader in developing renewable energy, not high energy consumptive hydrogen that is good for the people, the planet, and the company? I feel like we are doing way too little, way too slowly. I'm extremely worried for the future of our planet and our children.
Thanks for the question. Can I encourage anyone who hasn't read our climate report to read our 2022 climate report? I think it sets out very well our response to the significant issues that this question raises and the more generally raised by the community. I'd make a couple of comments, and I'll get Meg to expand on it. What I would say is that the world is committed to reducing emissions, and we have a plan post-Paris to do that. Now, it's an uncertain plan, and there's a lot in the energy transition, as we've all already articulated today, that is uncertain. I think we've made a lot of progress over the last five years. Woodside is determined to be part of that.
We're very confident we can in terms of reducing emissions through the use of gas, particularly where it substitutes the use of coal and through new energies. And we know we can run our businesses in a way that's ethical and responsible and meet the obligations. 15% reduction in emissions, net emissions by 2025, and a 30% reduction by 2030. I think Woodside is incredibly important to the energy transition, so that we're all less worried about the future of the planet, and we've and we meet the targets that we've set. Meg, do you want to add any more than that?
Well, perhaps I can point the readers, either online or in the room, to Page 13 of our climate report, which I think helps illustrate the uncertainty that faces us. As we think about the challenge of decarbonizing the world, the reality is there are many pathways that are compliance or meet the objectives of the Paris Agreement, which, you know, as Richard said, the world has signed up for, most of the nations of the world have signed up for, we as a company have signed up for. I think the debate is really about how we might get there and how we get there in a way that provides we'll call it energy justice for the people of the world.
Obviously, there's work that needs to happen in the developed world to reduce our use of energy, to reduce our energy intensity and the carbon intensity of the energy we use. There's still one billion plus people who are living without access to reliable electricity who'd like the benefits of the society and the modern living that we all here enjoy today. There's been tremendous work done by the scientific community outlining what scenarios might look like that deliver a Paris-compliant outcome. Again, if you go to this page in the reports, you'll see that there's a very wide range of the oil and gas usage that might be present in 2050, what the world's total energy consumption might be in 2050. To the...
An element of the question around CCS and carbon dioxide removal, that has absolutely got to be part of the solution. And that has to grow tremendously, and Woodside is doing work to look at opportunities both in Australia and in the U.S., for carbon capture and storage, because that is going to be part of the solution that the world needs. So those are some of the key thoughts. You know, as Richard said, our climate report provides a lot of discussion on these topics, and I'd encourage everyone to read it.
Thanks, Meg. Microphone two.
Mr. Chair, I have Dr. David Dale. He's a proxy holder representing, Conservation Council.
Thank you.
Hello. Is Woodside Energy prepared to make a major investment in additional emissions reduction equipment at the Burrup Hub? The result of that would be reduction in acid rain and particulates, would fit in with the company's proclaimed carbon reduction and environmental protection policies. Thank you.
Thanks, Dr. Dale. Meg.
Sure. Thank you for the question, Dr. Dale. As we describe in the climate report, one activity that we undertook last year was to really do a lot of work on our asset decarbonization plans. As we've talked about in the past, we've got a hierarchy for action on emissions. First off is design out. You know, the best way you can get rid of CO2 emissions is to not have them in the first place. Where we can, and this is applicable to our new investments in things like Scarborough, Pluto Train 2, Trion, we are challenging the team to ensure that from day one, we are designing those facilities to have as low emissions as we possibly can. That's design out. Operate out is the second set of practices.
And it's the way we run our business, and it's from my level all the way down to the frontline operator, where the operators have the authority and the confidence to make decisions around how they run the plants, and decisions that they can make to save emissions. And I was really pleased when I visited the Karratha Gas Plant and had the utilities panel operator very proudly point out to me that he had turned off a certain gas turbine generator to reduce our emissions. That's operate out. Third tool is offsets. But to your challenge, Dr. Dale, we know we can do better, and that's why we did the asset decarbonization plans, which has mapped out significant steps that we can take in each of our operating facilities to make further investments to reduce those emissions.
I spoke in my opening remark about the opportunity that we've been working on to progress a Woodside Solar Project that would bring solar power directly into the Pluto LNG facility. That would be a dramatic change in how LNG facilities are done. We think it's probably the first opportunity of this nature globally to bring solar straight into a power plant. This is an opportunity we hope to make an investment decision on this year.
Thank you. I heard your address to the Press Council a few days ago, and I was impressed. Thank you.
Thanks, Dr. Dale.
Thank you, Dr. Dale.
Sorry. Microphone three.
Mr. Chair, this is Ms. Jessica Panagris. Ms. Panagris is a proxy holder representing Mostia Dion Nominees Pty Ltd.
Good morning. I have a question that follows on from the discussion around Woodside's climate plan. The International Energy Agency has mapped out its net zero emission scenario, and they say that this is the most technically feasible, cost-effective, and socially acceptable Paris-aligned scenario. They've mapped how the world can meet its energy needs and meet the globally agreed target of limiting global warming to as close to 1.5 degrees as possible. Why then does Woodside attempt to discredit this scenario in its 2022 climate plan as a path, but not necessarily the path? My question to the chair is, does the Woodside board think it knows better than the International Energy Agency?
I'm not gonna respond to that question because you'll then put out a press release. I'm not responding to that. I'll get Meg to respond to. Our climate report talks about a range of scenarios. I don't think anyone has absolutely clear-eyed view on exactly what how these scenarios will play out. If anyone thinks they have, they've got the answer that no one else thinks they have. Meg.
Yeah. I have my climate report open to the exact page in question, which is Pages 12 and 13, which talks about the IEA Net Zero 2050 study in the context of the IPCC total range of studies. It's worth noting that the IPCC is the grouping of all the thousands of scientists around the world who do work on this topic. The IPCC's scientists have come up with, as I said, approximately 200 scenarios that are Paris compliant. The IEA has offered one possible pathway, but there are many possible pathways. We need to make sure that we're following a pathway that achieves the goals of the Paris Agreement, but also, as I said, ensures that we're continuing to provide reliable, affordable, and increasingly lower carbon energy to citizens, both in Australia and in our customer nations.
Thank you. Can I ask a follow-up then? If we're gonna talk about the IPCC, they put out their most comprehensive synthesis report on the climate science this year. What they said in there is that existing fossil fuel infrastructure already takes us over 1.5 degrees of global warming. Why then is Woodside investing in new fossil fuel infrastructure at the risk that that drives more dangerous global warming?
Look, I think you need to get into the detail, you need to go look at the 200 case studies. Again, gas is probably the best example. If you look at the range of IPCC outcomes, there are outcomes where gas use in 2050 is actually higher than what it was in 2019 or today. The IPCC would identify that there are very credible pathways that are Paris compliant, where gas use increases. Now, you have to look at the totality of the scenario. You need to look at all of the complexities. As I said a few minutes ago, things like CO2 removals are an increasingly important part of the mix.
CCS, carbon to products, direct air capture, all of these things need to have increased investment from where they are today to ensure that the world gets onto the right pathway.
Thank you. Microphone two.
Mr. Chair, this is Mr. Ian Stan. Mr. Stan is a shareholder.
Listening to all the reports that you've given and also the fact that we have this huge problem with climate change, I have to state that I studied nuclear power way back in 73 from Imperial College London. I studied it at that time mainly because I could see that the world would have a pollution problem in the future, and we knew it well. Of course, today we still have that, and it's only come to the fore. Of course, we are going in for nuclear power submarines. Of course, the Karratha relies on a base load, and nuclear power is ideal for base load because it sits down there sitting and churning out power all the time at 0 emissions.
Why is that not part of the plan or the energy mix in addressing climate change?
Well, Mr. Stan, it's a very good question, and it's not one that I can answer because I think it's a question that is actually much more national policy. In fact, I think at the moment in Australia it's illegal, based on the legislation we've currently got. It can't be something that we're actively and it's not something that we're actively considering. It's something that would have to be brought about through a change in government policy. No? Two. Well done. Microphone three. I'm gonna wrap this section up in one minute. Microphone three.
Mr. Chair, this is Mr. David Ritter. Mr. Ritter is a proxy holder representing Mr. Thomas Joseph Hunt.
Morning, Mr. Chair.
Morning, David.
Woodside is a key industry partner for the Australian Industry Energy Transitions Initiative, which earlier this year launched a comprehensive report into decarbonizing the LNG sector. Now, that report outlines a 73% drop in LNG production by 2040 alongside rapid and stringent on-site emissions reductions. Will the board commit to aligning Woodside's plans with this study in which it was a key partner?
Thanks, David. You looked very good on television last night, by the way.
Appreciate that. Thank you.
Meg.
Yeah, thanks for the question, David. Nice to see you again. There are a number of different pathways, and I'll again go back up to the high level message of, there are many Paris compliant pathways. Gas is going to play a very important role in helping the world meet its, Paris ambitions. Within an Australian context, you know, we will do our best. We will continue to be an important partner in the conversation. If you look at, for example, our commentary, which is available on our website on the Safeguard Mechanism re-reform, we acknowledge that the 4.9% annual emissions reduction target was a very challenging target, but we backed it.
We said that this is important for Australia, and we said it's important that we have a level playing field and all 200+ Safeguard Mechanism facilities, work to the same goal and have the same challenge. We feel like we're doing our part within the Australian context. There still remains really attractive gas development opportunities in Australia that can help our customers meet their energy needs whilst they also decarbonize.
Is that a no?
Have you got your press release ready to go, David, again?
You could still make it much more interesting. I mean, I'm a Western Australian. You're a really significant company.
Mm.
It seems to me, observing the corporate culture from the outside, that there is a great tendency to always assert Woodside's correctness and to cast doubt on everyone else. Why can't you be more ambitious about this? Why can't you pick the most ambitious pathways as the right way for the company to go forward instead of the. I mean, if we had a sort of prize for every mention of the word uncertainty, what about some ambition?
Well, I actually We'll differ on that, David, because I think we're ambitious. Thank you. I think we got another question online. As I said, I'm gonna wrap this up soon because most of the questions are on the same matter.
Thank you, Mr. Chair. We have an online question from Mr. Ian Thomas Dunlop, again, regarding the Paris Climate Agreement 1.5 and 2-degree scenarios. Mr. Chair, your climate report justifies gas expansion on the grounds that it can still fit within the IPCC scenarios, which will deliver 1.5 degrees with a 50% probability of success. If the probability of achieving the 1.5 or even 2-degree targets is raised to probability levels consistent with the LNG business, say 90% or 95% at least, there is no carbon budget left today under any scenario. You and the board would not get on an aircraft to fly to Perth if your chances of safe arrival were only 50%. Why then are you prepared to gamble the future of the company on this level of risk?
I think the analogy is completely wrong. We've addressed, and Meg's spoken about it today, the IPCC scenarios previously, and there are a wide range of scenarios. I think, again, shareholders should look at Pages 12 and 13 of our climate report, and if they want, read the other scenarios. I'm gonna go to microphone four, but if it's a question on environmental issues, I'm gonna conclude the session. Microphone four.
Mr. Chair, this is Mr. Tim Frodsham, who is a proxy for Mrs. Susan Edwards.
If it's a question on environmental issues, I'm gonna move on.
It's a question concerning your carbon offsets strategy. We'll pass on that.
No, we'll talk on offsets. Thank you. Yeah.
Great. I just wanna start by acknowledging it's really great to hear that you've got a support for a Voice to Parliament, as well as the federal resolutions on the Safeguard Mechanism as it stands. Thanks for that.
Yeah.
At last year's AGM, a shareholder question was asked if Woodside would publicly release accurate and detailed information about its carbon offset strategy for independent review. The answer given by Ms. O'Neill was that the company's offsets strategy was based on world's best practice. Section 3.6 of your climate strategy leaves me feeling a little less confident because it sort of tends to refer to and attribute to various standards and scenarios, but there's no clear mapping of what that offset strategy is gonna be. Subsequent requests for you to disclose that strategy in detail yielded no response. Are you able to now address the credibility gap and dispel obscurity and make your offset strategy and methodology publicly available? Thanks.
I'm sorry, I missed your name.
My name is Tim Frodsham. I'm
No, that's all right.
Yeah.
Thank you. I'll get I think we've gone into a lot more detail on offsets in our climate report this year, Meg. It's an area that where there's now been an independent government assessment on offsets as well.
Mm-hmm.
which validates the use of offsets, and I think absolutely validates the offsets that we're using.
Mm-hmm.
Did you wanna add anything to that?
I think you've made important points, Richard, that the independent study has verified the use and in the SGM reform, actually. The government is emphasizing the role of ACCUs in helping, or Australian Carbon Credit Units, in helping meet the decarbonization goals of the Safeguard Mechanism facilities.
Will those offsets be inclusive of Scope 3 emissions, which represent more than 90% of the company's emissions strategy?
I think we've already clearly addressed that our emissions reduction targets for Scope 1 and Scope 2 are to reduce by 30% by 2030 and offsets is part of that mix. Our Scope 3 target is to invest $5 billion in new energy products and carbon solutions by 2030.
Thank you.
Thank you. Microphone three, if there are questions on the matters we've already covered, I'm not gonna deal with them, so...
Thank you, Mr. Chair. I have, Mr. Paul Slythe. Mr. Slythe is a shareholder.
Mr. Chairman, thank you for allowing me to... I just wish to ask a simple question. Have Woodside considered and investigated tidal power as a positive way to boost complementary green energy base extension 24 hours, seven days a week? This has been successfully operated in France for some 40 years and is still operated today. This has been investigated by others over many years here in WA since before 1980, France has a similar seven meters rise in the tide. I just suggest that this is a positive way of overcoming some of the problems we're faced with today. The second question is the Voice. It mentioned in the, by the executive saying they have made a decision how they're gonna vote for the Voice as it stands. I'm saying this is not necessarily right.
All the shareholders should have their equal right to say how they feel. I do understand that all the Aboriginal people have an exact right. The question is how it goes about should be something that each individual shareholder be able to make a decision on that matter.
Mm-hmm.
Yeah.
Thank you, Mr. Chairman.
Thanks, Mr. Slythe. We'd actually agree with you on the second part of your question. We think it's absolutely a matter for every one of our stakeholders, whether they're employees, whether they're shareholders, whether they're our customers in Australia or whatever. We think it's an issue for the Australian public.
Mm-hmm.
As a group, we have a view, but it's the view of a group-
Mm-hmm.
-of Woodside as a company. I'll get Meg to respond on the tidal power question.
Yeah, thanks for the comment, Mr. Slythe. Appreciate your perspective. We keep a watching brief, and we scan a wide variety of technologies. I guess going back to Mr. Stan's question, you know, we do keep current with evolutions in nuclear power. We do monitor what's happening in things like tidal power. At this point in time, it's not a direction that Woodside is choosing to pursue. It requires a skill set that's a bit different from the skills that we have in our company today. You know, part of why we're focused on things like hydrogen and ammonia is those are very large-scale industrial facilities processing at very significant, you know, very significant quantities of energy. Those skills are very adjacent to what we do in the LNG industry.
Yeah.
Tidal is something that, you know, doesn't necessarily align with our skill area. We continue to watch all these technologies, and if our strategy changes, we'll keep our shareholders apprised.
Thanks, Meg. Microphone two.
Mr. Chair, this is Mr. Thomas Hartigan. Mr. Hartigan is a shareholder.
Good morning. I just want to compliment Woodside on what they've been able to achieve on a worldwide basis, especially the assistance now that you're giving to Victoria and New South Wales in relation to gas supplies to reduce their electricity costs. I would also think it's appropriate, given the large scale of operations of Woodside around the world and supplying gas into Asia and so forth, that Western Australian users of gas, which help to produce their electricity and so forth, they've had two increases in the last two financial years, and I think they could have been modified to reduce the cost in Western Australia. We've traditionally had this reserved supply of gas, which has been a blessing to Western Australians.
Mm-hmm.
I would like you to comment about, why the increases have not been held, to help people, in their cost of living circumstances in Western Australia.
Thanks, Mr. Hartigan. Again, Meg might want to comment. I'll make a couple things. Western Australia has a different domestic gas policy than the rest of the country, and we have a gas, 15% domestic gas reservation policy in this state, which has assisted industrial and commercial and private residents in terms of access to affordable energy. We shouldn't assume that it lasts forever-
Mm-hmm.
because as our existing and others' existing gas projects, come off stream as they deplete their reservoirs, unless we develop new opportunities in West Australia, we won't have that we've.
Mm-hmm.
enjoyed for some decades in this state. As Meg said earlier, we're doing everything we can to bring every molecule of gas into the East Coast energy markets at the moment because there are supply issues on the East Coast. There's obviously government policy at the moment capping pricing. The domestic gas prices is more an issue for the retailers and government than it is for us.
Mm-hmm.
Anything else?
No.
Thank you for your question. Microphone three.
Thank you, Mr. Chair. I have Ms. Anna Chapman. She is a proxy holder representing Terence Edward Pinnell.
Sorry, I missed the name.
Ms. Anna Chapman.
Ms. Chapman. Thank you.
Planned growth from Australia's coal and gas producers is enough to see Australia's fossil fuel interests exceed the entire Safeguard Mechanism's emission budget in 2030, rendering our climate goals unachievable. How does Woodside plan to achieve gross emissions reductions, excluding efficiency measures, that will actively and fairly contribute to cuts required to meet Australia's climate goals?
Thanks, Ms. Chapman. I think we've dealt with that today already. Thank you. Microphone one.
Mr. Chair, I'd like to introduce Dr. Bulbeck. Dr. Bulbeck is a shareholder.
Thank you.
My question concerns Woodside's failure to act to eliminate the harmful nitrous oxide and sulfur dioxide emissions, which are a byproduct of its operations, and which are harming the Murujuga Rock Art and the local people's health. In June last year, the EPA recommended oxides of nitrogen emitted by the Karratha Gas Plant be reduced by 40% by 2030. In March this year, the EPA advised Woodside to act urgently to ensure that air emissions from the Pluto proposal do not accelerate the weathering of rock art on Murujuga beyond natural rates. There's also strong evidence these emissions are affecting the health of local people. Children are hospitalized for asthma at almost twice the Western Australian state average and for bronchiectasis, which is damage and widening of the airways, 11.5 times more than the WA state average.
I know Woodside disputes the impact of these harmful emissions, surely the precautionary principle is advisable, especially as there is available technology to almost entirely eliminate these emissions. Considering its $9.65 billion profit after tax last year and its desire for social license. Why won't Woodside put in place the comparatively cheap scrubber technology to minimize its emissions and the impact on the World Heritage-nominated Murujuga Rock Art and the health of local people?
Thank you. Meg.
Yeah. A few comments. Appreciate the question. Woodside has been active in monitoring rock art and air quality since we since early days of operations on the Burrup, and we are active supporters of the Murujuga Rock Art Monitoring Program, which is now run by the Western Australia Department of Water and Environmental Regulation and administered by the Murujuga Aboriginal Corporation, so the traditional custodians of the land on which we operate in the Northwest. We have continued to work very closely with them to understand the reality and understand exactly what is happening with the air quality. We have worked very closely with these groups for many years. That said, we do recognize that we need to continue to take action to address our emissions.
I spoke earlier about our design-out philosophy. For example, with our Pluto Train 2 design, we took a number of steps to ensure that that facility is more emissions efficient than any other train on the Burrup. We take action, and we've been taking action to address the emissions in our existing and operating facilities, and the Karratha Gas Plant has facilities that are 40+ years old. We've taken steps to try to reduce the emissions from those facilities, and we implemented a project last year on Train 1 to capture some of those additional emissions. We are taking steps, and we are working very closely with the government. The EPAs have imposed some targets for us, and we will work very closely to achieve those objectives.
We are supporting World Heritage.
Yes, we support the World Heritage listing. I think that's important to note. You know, we work very closely with Murujuga. We listen to them. We're informed by their wishes. As I noted in my speech, the Scarborough Cultural Heritage Management Plan, I think is a great example of how collaboration between industry and traditional custodians can deliver better value for everyone.
Can, can-
Yeah.
Oh, sorry.
No, no.
Could I just ask a follow-up question?
Yeah.
Which would be very quick?
Thank you.
The technology that I understand could be used is the selective catalytic reduction system. What % actually of your profits would it which I understand can reduce emissions virtually to zero. What % of your profits after tax would it cost to install that?
I don't have an answer. I would. Is Peter Metcalfe here today? Is Peter here? Tony Cudmore would be here.
Mm-hmm.
I might get Tony Cudmore, who looks after sustainability for the group, to catch up with you afterwards and follow that through.
Okay.
Thank you for your question.
Thank you.
Thank you. I'm gonna take one last question on item one. Microphone three.
Thank you, Mr. Chair. I have Mr. Ted Keegan. He is a proxy holder. He's unable to identify for whom.
Mr. Chairman, Ms. O'Neill, my question is on offsets. As you mentioned, climate justice. A report published by the CSIRO in 2023 on mitigation and offsets to Australian greenhouse gas emissions states that Australia has a capacity to offset 86-163 megatons of greenhouse gas emissions per year. Australia's latest emission figures reported to the UNFCCC totaled 498 megatons, with 537 megatons actually released to the atmosphere. Why is Woodside continuing with its plans to apply offsets to cover the majority of its future emissions reductions, and how does this relate to climate justice?
Thanks, Mr. Keegan. Meg.
Sure. I'll reference again the climate report, where we have some very, I think, constructive illustrations of the role of offsets in meeting our 2030 emissions reduction targets. I think an important point to note and in response to previous question, we've taken steps over the past year to really increase the amount of emissions that we can operate out or design out, so the emissions that we can actually reduce from our facilities. Offsets will remain a portion of our components, or a portion of our emissions reduction target will be met through offsets. Look, we've done a lot of work over the past five years to build a carbon business, which gives us the confidence that we will be able to source high-quality offsets to meet those emissions reduction commitments.
Thanks, Meg. I'm gonna move on to item two. I think we've exhausted the questions both online and in the room on item one. Items 2A, 2B, and 2C relate to the re-election of Mr. Macfarlane, Mr. Archibald, and Ms. Goh as directors who retire by rotation at this meeting. Being eligible, Mr. Macfarlane, Mr. Archibald, and Ms. Goh offer themselves for re-election. Each year, the board conducts an evaluation of the performance of individual directors. Based on the 2022 performance reviews, the board supports the re-election of Mr. Macfarlane, Mr. Archibald, and Ms. Goh. Item 2D relates to the election of Mr. Breuillac as a director. As Mr. Breuillac was appointed since the last annual general meeting, he's required under the company's constitution and the ASX Listing Rules to retire at this meeting. Mr. Breuillac being eligible, offers himself for election.
The board supports the election of Mr. Breuillac as director. Item 2E relates to the election of Ms. Minnis as a director. Elected, Ms. Minnis will be appointed with effect from the conclusion of this annual general meeting. The board recommends the election of Ms. Minnis as a director. Details of the directors seeking reelection or election are set out in the explanatory notes accompanying the notice of meeting. We'll now hear from the directors seeking reelection or election to the board and then take questions on all elections and reelections together. Can I ask Ian Macfarlane to come to the microphone, please?
Well, thank you, Mr. Chairman. Thank you, shareholders, for attending the meeting. Can I begin by acknowledging the traditional owners on the land on which we meet and the land on which we operate? Can I pay my respects to their elders, past, present, and emerging? Over the last six and a half years, I've been able to contribute from a unique set of skills, not only in farming and resources, but in science, innovation, and commercialization through a diverse background in developing public policy and also in the area of public policy around climate change and carbon reduction. I seek your support for a further three years as a board member of Woodside on the basis that I still have more contributions to make to ensure that we achieve our goals. Thank you.
Thanks, Ian. Can I now ask Larry Archibald to come to the microphone, please?
Good morning. I'm Larry Archibald. I'm an American with about 40 years of experience in the oil and gas business with several large multinational companies. Fortunate to have had experience in many of the hydrocarbon basins around the world, including places where Woodside has producing and exploration interests today. It's been a real privilege to serve on your board for the past six years and to be a part of such an effective board and a great management team. Seek your support for another term. Really enjoy working with these guys and are proud of what they've accomplished, both in the base oil and gas business and what we're very thoughtfully doing in new energy and managing the energy transition. Thank you.
Thank you, Larry. Can I ask Swee Chen Goh to come to the microphone, please?
Thank you, Chairman Richard. Good morning, shareholders. My name is Swee Chen Goh. I'm currently based in Singapore. I have 40 years of experience. In the last three years, I've divided my time equally between for-profit boards and also nonprofit boards in education, in the arts, and also specifically in addressing some of the issues that face our societies and communities today, such as mental health and sustainability. I am quite hopeful that with my past experience in digital technology, in running and leading businesses that are customer-centric, in running Shell in Singapore through an energy transition, that I, together with the members of the board of directors, within Woodside, I'm hopeful that we will responsibly steward Woodside through an orderly and just transition that will meet the needs of both its shareholders and its community.
I'm also hopeful that you, as you look at the experience that I have, could see that I can contribute based on the experiences in the past and also the term that I have served, the last three years in Woodside, that we collectively could continue to steward Woodside to greater heights and greater success. Thank you, and I appreciate in advance, your approval for my re-nomination.
Thank you, Swee Chen. Can I now ask Arnaud Breuillac to come to the microphone, please?
Thank you, Richard. I'm very pleased and honored to be here today to attend this AGM of Woodside Energy, your company. I've been working at retail, in fact, last year from Total, now TotalEnergies, after 40 years with the company. I was involved in projects and operation for 20 years and then the other 20 years involved in asset management, and the last eight years as a member of the executive committee of TotalEnergies in charge of E&P. As part of that team, I got very much involved in the definition of the new strategy of the company with regard to new energies and the strong development of LNG.
I'm passionate about providing affordable, reliable, and clean energy to people. I hope that I will be able to contribute to the successful development of your company. I seek your support for my election as a board member. Thank you very much.
Thanks, Arnaud. Can I now ask Angela Minas to come to the microphone, please? Angela.
Thank you, Chairman, and good morning. I'm Angela Minas. I have over 35 years of experience working with energy companies across the energy value chain. I have done so in consulting, senior executive, and over the last decade, board of directors and audit committee roles for internationally listed companies. I am very excited and passionate about the opportunity to be able to work with Woodside Energy and serve on the board of directors during this critical period of energy transition and decarbonizing the world. I appreciate your support.
Thank you, Angela. The motions that Mr. Macfarlane, Mr. Archibald, and Ms. Goh are reelected as director, and Mr. Breuillac and Ms. Minas are elected as directors are now before the meeting. Are there any questions on item two from any shareholders, either online or in the room? Microphone three.
Thank you, Mr. Chair. I have Mr. Chris Schott. Mr. Schott is a shareholder.
Well, thank you, Mr. Chairman. I have a view that one of the important things in internal company democracy and external is of course the election of directors who have to take responsibility. I'm looked at the individual members you've put forward, some to be reelected and some, two to be added. I don't have, on an individual basis, any criticism of the career each of those people have provided. I raise a broader issue, Mr. Chairman, that the board aware this company of the issues it's facing, which many other people have raised today about climate change, the future of gas in the world, et cetera, and other fossil fuels.
In the future, this board is going to have to have members on it that have a background, not just individually in the industry, but have genuine knowledge of where of what the issues are facing. I find it interesting that I'm here as a former... I got shares issued because as a BHP shareholder. Over 10 years ago, BHP took a big decision. I was there when they announced it at their.
I don't want a long speech.
I know, I know.
Question.
I'm just going to come to the say, they took a decision to get out of fossil fuels. That was a board decision. The reason I think it occurred is that there were two or three members of that board, women in particular, who shifted the focus. I just draw it to your attention that I think you, I'm sure you will do it as the chair and there's a nominations committee, but you're going to have to, I think, be much more sensitive of how you put a board together that faces the challenges of a fossil fuel industry over the next decade.
Thanks, Mr. Schott. I concur with your comments. It's something we take very seriously. I take and the rest of the board takes the composition seriously of the board and we think governance is incredibly important. What I would say is, The current directors of Woodside are very aware and responsive to the issues that we've discussed this morning, that I would say it's, you know, along with appointment of CEO, significant transactions like the BHP Petroleum merger, how we navigate our way through the energy transition and how we allocate capital through that would be the most significant issue we discuss as a board.
We're always looking to renew, and we're looking to bring people, not just onto the board, but into the executive team that bring the capabilities that you're talking about, to the table. We're very alert to it, and I appreciate your comments. Thank you. Microphone four.
Mr. Chair, this is Mr. Will van de Pol, who's a proxy shareholder for Dr. Linda Young.
Thanks for the opportunity. Mr. Goyder, at last year's AGM, in response to questions about the board's and Woodside's unresponsiveness to a significant shareholder vote for a climate-related resolution back in 2020, you mentioned that there was significant support for the reelection of directors, and that indicated significant support for the direction the company was headed in. I will note that the average ASX director is passed with about 96.5% support of shareholders. My question is, how much of a protest vote will it take on the reelection of directors today for the company to recognize that shareholders do not support the direction that the company is headed in, particularly in its climate strategy?
Thanks, Mr. van de Pol. I think the most important vote we've had in the last 12 months was the shareholder vote on the merger of the BHP Petroleum business, which was overwhelmingly supported by shareholders.
That's, sorry, not a response to my question at all.
Microphone three. No. If there no further questions, and I don't think we've got any online, I now put resolutions 2A, 2B, 2C, 2D, 2E to the meeting. Each of these resolutions is independent, should be voted on separately. Please enter your votes for items 2A, 2B, 2C, 2D, and 2E. A summary of the proxy and direct votes received before the meeting on these resolutions will now be displayed on the screen. We'll move to item three now, which is to consider the company's remuneration report for 2022. The report is set out on Pages 75-98 of the annual report. It explains the company's policy on the remuneration of non-executive directors, the chief executive officer and other senior executives, and provides remuneration information for 2022.
Although the vote on the remuneration report is only advisory, the board will take the outcome into consideration when determining the company's remuneration policy. The motion that the remuneration policy for the year ended 31 December 2022 to be adopted is now before the meeting. Are there any questions on this item from shareholders, either in the room or online? Microphone three? Yeah.
Yes, Mr. Chairman, I have Mr. Chris Schott again.
Mr. Schott.
He's shared that.
All the environmental questions I'll leave to others. My only question is about the remuneration report.
Yeah.
It's the biggest individual section in the annual report, dealing with income to half a dozen of the top executives. It's to have the fact that this report, that our annual report biggest area written about is remuneration for senior executives, bigger than any other issue. I understand, Mr. Chairman, that you are required by law to have very detailed explanation, but I would just wonder, is it possible-
Mm.
To make it much simpler to explain, rather than having to be Einstein mathematically. Work through the justification for these bonuses, et cetera. I've raised the question of BHP, Westpac for exactly the same reason. They all give the same reason. The government requires by legislation to be this detailed. I just hope in the future you can get it to be a much smaller section, and there's more detail on the real issue of the business plan.
Thanks, Mr. Schott. Hopefully, through the rest of the annual report and the sustainability report and the climate report, you're getting good information on the company and also online and when we do things like share investment briefing days similarly. I'd commend to you and other shareholders that you look at, particularly when we do presentations to shareholders of the investor briefing days. I take your point on remuneration. Unfortunately, it's where we're at. I can't give you a good response other than a lot of shareholders demand this sort of information, and certainly proxy advisors demand the information that we put in the annual report. I share your pain. Yeah. Microphone three.
No more further questions, Mr. Chairman.
Okay, thank you. I don't think there's any more. If that's the case, I'm gonna put item three at the meeting. If you've not already done so, please submit your vote on item three now. A summary of the proxy and direct votes received before the meeting are now displayed on the screen. I'll move to item four, which is the CEO Executive Incentive Scheme Awards. Item four on the agenda is to consider the proposed grant of restricted shares and performance rights to the CEO on the terms set out in the explanatory notes accompanying the notice of meeting. These Executive Incentive Scheme Awards form part of Meg O'Neill's remuneration for the 2022 financial year. Yeah, from her outcomes for that year. The motion is now before the meeting.
Are there any questions in relation to item four from shareholders, either in the room or online? If there aren't, I'll move to put item four to the meeting. If you've not already done so, please submit your vote on item four now. Again, I'll put up a summary of the proxy and direct votes received before the meeting on this resolution on the screen. Thank you. I'll move to item five, which is Non-Executive Directors' Remuneration. Item five on the agenda is to consider and if thought fit to approve the increase in the maximum amount available for payment of Non-Executive Directors' remuneration, as set out in the explanatory notes accompanying the notice of meeting. This motion is now before the meeting. Are there any questions? If not, I'll put item five to the meeting.
If you've not already done so, please submit your vote on item five now. A summary of the proxy and direct votes received before the meeting on these resolutions are displayed on the screen. I'll now move to item six, which is on constitution and capital protection. These are requisition shareholders. Item six A and contingent item 6 B on the agenda relate to the resolutions requests requisitioned by a group of shareholders representing less than approximately 0.002% of our shares. Details of the resolutions and the board's response are contained in the notice of meeting. The first resolution is a special resolution seeking to amend Woodside's constitution to facilitate advisory resolutions relating to material risks to the company. Item 6 B is conditional on item 6 A being passed by the required majority of shareholders.
This resolution requests that the company disclose in subsequent annual reporting information that demonstrates how the company's capital allocation to oil and gas assets will align with the scenario to which global energy emissions reach net zero in 2050. The board has responded to the requisition resolutions in detail in our notice of meeting. Further information on Woodside's climate-related plans, activities, progress, and climate-related data, as we've already discussed, contained in the climate report. While item 6B is contingent on item 6A being passed by the required majority, as foreshadowed in the notice of meeting, we would invite questions and comments on both resolutions before I formally put 6A to the meeting. Are there any questions on items 6A and 6B? It looks like we've got one online.
Mr. Chair, this online question comes from Mr. Robert John Brown and Mrs. Muriel Elizabeth Brown. As an energy company, is the Woodside management mindful of a very different company personality that energy companies will need to have by 2050 and beyond? More specifically, why is it not actively transitioning its business model away from fossil fuels towards energy sources that are inherently sustainable and do not require unproven and unscalable band-aid solutions like CCS? Witness, the poor performance of the Gorgon CCS endeavors.
Thank you to the Brown family for the questions. I think we've pretty well done this. Do you wanna just add anything on CCS, Meg?
Yeah. I think I will add something on CCS because it is a technology that is probably misperceived in an Australian context. Carbon capture and sequestration has been used for decades successfully in the United States. It was initially used for enhanced oil recovery, so to use CO2 to try to get more oil out of the field. That has proven up the technology. It's proven up what's required to get CO2 into the ground, how to store it safely there, how to ensure that it's captured. The technology's been used in an offshore setting for more than a decade in Norway. Whilst there's only one CCS project in Australia, and the operator of that project, has admitted there were challenges during the startup, they are sequestering CO2 today.
The technology itself is not only viable, but it will be essential to help meet the world's decarbonization goals. I think it's important that we continue to pursue these opportunities both in Australia and in the U.S. Recognizing that the U.S. has significant financial incentives through the Inflation Reduction Act, that makes those even more attractive as investment opportunities.
Thanks, Meg. Microphone four.
I again have Mr. Will van de Pol, who's asking the question as a proxy for Dr. Linda Young.
Thank you. The board's recommendation on this resolution states, "The board considers that the Climate Report 2022 satisfactorily addresses Woodside's approach to the risks and opportunities presented by climate change and the energy transition." Before going on to conclude, accordingly, the directors are of the view that the resolution is not necessary. Given 49% of your shareholders voted against the 2021 Climate Report, and the lack of progress since then has seen significant shareholder votes against the re-election of one director in particular today, will the board now accept that the Climate Report does not satisfactorily address Woodside's approach to the risks and opportunities presented by climate change? That the company's existing decarbonization steps, public commitments, and reporting practices are not sufficient for the board to conclude that this resolution is not necessary.
Thanks, Mr. van de Pol. I think you read out our response, and I'm not gonna reiterate that. That's the response the board has to that. I would say that we've made a significant advancement in our Climate Report of 2022 over 2021 based on a substantial number of meetings, many of which I've attended myself with shareholders, as have Meg O'Neill, Graeme Tibber, and the executive team. We have done dozens of meetings with shareholders on our approach to climate and the 2022 report is proof of that, as is the commitment we've made to put a 2023 report to the 2024 AGM. I don't accept the other elements of your question.
Overwhelmingly, shareholders have been very positive about the performance of Woodside over the last 12 months.
Mm.
I think 35% vote against the re-election of a director is an extremely rare occurrence, and that would speak to the fact that shareholders are not overwhelmingly supportive-
Well, of course.
of this company's directive, direction.
Of course, that director's a former politician, so he reckons anything above 50% is a great outcome. Thank you very much. Thanks, Mr. van de Pol. Thank you. I, microphone three.
Thank you, Mr. Chair. I have Mr. David Ritter. He is a proxy holder for Thomas Joseph Hunt.
David.
I think it's good afternoon now, Mr. Chair.
Yeah, it probably is.
Appreciate the invitation to read the climate report in detail. In its latest climate report, the company refers to a technically unfeasible scenario from an old IPCC report from 2018, and it relies upon that to argue that increasing global gas use remains a valid 1.5 degree pathway. This scenario involved extraordinarily high levels of carbon capture and storage that would require capturing 8.8 gigatons of CO2 every year from now until 2100. Currently across the world, only 0.04 gigatons of CO2 is captured every year, which is 220 times less than what's required under the outdated scenario that's relied upon by Woodside.
Given what you've just said about the significance of the climate report, will the board commit to stop relying on outdated carbon capture assumptions in its next climate report?
Meg.
Well, thanks for the question, David. We continue to review, revise, update as new information becomes available. The IPCC synthesis report was released recently, the outcomes of that will get incorporated in the 2024, the 2023 report for 2024 voting. We continue to update as new scientific information becomes available. I think any of the many of the IPCC scenarios, you look at the range associated with the Paris compliant IPCC scenarios, all of them do require substantial CO2 removals. Which is why we are very actively working on things like carbon capture and sequestration, as well as technologies in the carbon to product space, which takes CO2 and creates something useful from it.
We continue to update our science and, look, David, it's probably worth offering a follow-up with you and our climate team as well.
Yeah.
To make sure that we've got clarity and have those open lines of communication. We welcome the input from you and your associates.
Thank you. I don't think you've said, yes to the request for a meeting so far, so, it's nice to get that very public, acceptance here. Thank you.
I was gonna say the same thing, David. I think it's important that, we engage, even if on some things we don't agree, we should be engaging and see where we can constructively, move forward on some things that are important to both Greenpeace and Woodside. Thank you.
Well, I think, I mean, the matter I think we probably don't agree on most of all is again, just that level of ambition.
Mm-hmm.
I think I heard you earlier on, Meg, say that the best way or words to this effect, the best way of reducing emissions is at source.
Mm-hmm.
I don't think we would disagree with that if that became the guiding principle of Woodside's future as a business. Thank you.
Thank you. I now put Item six A to the meeting. If you've not already done so, please submit your vote on Item six A now. A summary of the proxy and direct votes received before the meeting on this resolution are displayed on the screen. It's clear from the proxy instructions received that Resolution 6 A will not be passed by the 75% majority required for a special resolution. As Resolution 6 B is contingent on 6 A, it's not required to be put to the meeting. However, in the interests of transparency, a summary of the proxy and direct votes received before the meeting on Resolution 6 B are also displayed on the screen. That now covers the formal business of the meeting and the voting system will close shortly. Please ensure that you've cast your vote on all items. Is anyone still voting? Still voting?
Do you want to help? Yeah. I'll just wait for a minute to formally close the poll until you've got an opportunity. Just give me a minute so this shareholder can vote, please. What I will say is, Computershare will undertake an audit of the results, and the final results of the voting on all resolutions will be available and released to the Australian Stock Exchange, the London Stock Exchange, and the New York Stock Exchange after the meeting. Just once we've cleared this shareholder. I do want to thank everyone in the room for your constructive contributions today, and look forward to continuing the conversations in and outside this room as we move forward. Have we got that done? Warren, can I close the poll?
Provisional results, so yeah.
Provisional results. The provisional results on the screen will be the combined results of the votes cast by shareholders present today and those previously submitted by proxy. You can see the provisional results show. Hopefully, you'll be able to see soon.
Coming up.
Waiting.
Coming up shortly.
Are we having a technical issue or is it?
No, I think Computershare is just closing the votes and the provisional results should be coming up shortly.
If you didn't hear, Computershare just closing the poll, the provisional results should come up shortly. Here we go. They are now on the screen. As you can see, provisional results show that each of Resolutions 2 A, 2 B, 2 C, 2 D, 2 E, 3, 4, and 5 have passed. 6 A, requisition by shareholders not endorsed by the board has not passed. Again, thank you very much for your constructive participation today. I wish you all a good day. I would now declare the meeting closed. Thank you.