Thank you for standing by and welcome to the Woodside Energy, WDS, Half Year 2022 Results. [Operator Instructions] I would now like to turn the conference over to Ms. Meg O’Neill, Chief Executive Officer and Managing Director. Please go ahead. Meg O’Neill: Good morning, everyone, and thank you for joining our 2022 half year results investor call. It’s a pleasure to be talking with you all again. We are presenting the results today from Sydney. And I would like to begin by acknowledging the traditional custodians of this land, the Gadigal people of the Eora nation and pay my respects to their elders past, present and emerging. I also extend my respect to all other Aboriginal nations, the future generations and their continued connection to country. This morning, we published our half year report and results briefing pack for release to the Australian, New York and London Stock Exchanges. I am joined on this call by our Chief Financial Officer, Graham Tiver. This is the first set of financial results released since the merger with BHP’s Petroleum business completed in June. It was 12 months ago that we announced our intentions for the merger, the night before our 2021 half year results. I am thrilled to be here now in the knowledge we did what we said we would and that the combined business is delivering the benefits we expected. Today’s Woodside Energy is a significant player in the global energy sector. Today, I will provide an overview of the company’s performance in the past 6 months, Graham will then describe the financial results and I will close the presentation before opening the question-and-answer session. Please take the time to read the disclaimers, assumptions and other important information on Slides 2 and 3. I’d like to remind you that all…

Thank you, Meg and good morning everyone. Starting off with Slide 17 every financial metric points to the improved performance compared to the first half of 2021. The key drivers behind these positive outcomes are our continued strong operational performance, higher prices for our products, and the addition of the former BHP assets to the portfolio. The impact of the merger and these half year results mean that our balance sheet is well positioned for the major capital expenditure ahead and we have been able to continue to deliver strong shareholder returns. Slide 18 shows the key contributors to our net profit after tax or NPAT. Each bar shows the increase or decrease in each category compared to the first half of 2021. Increased pricing and increased production volumes resulted in a $3.3 billion increase to sales revenue. Production volumes were boosted by the acceleration of Pluto volumes through the Pluto KGP interconnector and the contribution of the new merged assets for 1 month. One positive – I am sorry, other positive contributors to NPAT include the de-recognition of the Corpus Christi onerous contract provision as a result of a strong market conditions and the sale of a 49% stake in the Pluto Train 2 joint venture to Global Infrastructure Partners, which completed in January ‘22. We incurred over $400 million of merger transaction costs, which include items such as stamp duty. Trading costs also increased due to higher commodity prices despite a decrease in trading activity. We also recognized hedging losses, as outlined in the half year report and incurred significantly higher taxes, royalties and excise liabilities, resulting in a reported NPAT of $1.6 billion. The underlying NPAT of $1.8 billion, which is used as the basis of the dividend calculation, removed the one-off impact of the merger transaction…

Thank you. [Operator Instructions] Our first question will come from Tom Allen of UBS.

Hi, good morning, Meg, Graham and the broader team. Congratulations on a solid result. Just on capital management, so gearing still towards the bottom end of your new range after paying out the interim div, business well positioned to generate strong free cash. Can you share some further color on how Woodside is going to balance your capital returns with growth over the next couple of years recognizing Graham’s comment on the $9 billion of CapEx between now and the end of ‘24? As I mentioned, there were special dividends and buybacks. Should we consider a trade on investment decision and/or sell down on Scarborough Sangomar the catalyst for further capital management activities? Meg O’Neill: Yes, thanks for the question, Tom. So as Graham articulated, we have been spending quite a bit of time working through our capital management framework and the adjustment to our target gearing range is one that we think is prudent. It reflects the balance sheet at the new post-merger Woodside Energy Company, reflects the fact that we have got considerably more equity in the markets and lower debt. And we have taken a look at some things that are important guardrails for us. First off is protecting our strong investment grade credit rating. Secondly is our commitment to return value to shareholders through the cycle. And as we mentioned last year, the Board has reaffirmed the dividend policy of 50% payouts. But as you see today, we have been able to deliver an 80% payout ratio recognizing the market conditions that we are in. So as we go forward, obviously, these guardrails will be informing some of those future capital investment decisions that we might take when it comes to other project investment opportunities. There is a number of things in the hopper train, of course is one that’s relatively mature, because it’s been through FEED, but there are other things in the new energy space, for example and other projects that we are evaluating. So we want to make sure that we are well positioned to be able to execute the work that is currently underway as well as keep the door open to some of those future investments.

Okay. Thanks, Meg. That’s clear. Just a question on your spot sales exposure, so over the June quarter, the realized price for produced LNG was $13.80 MMbtu and that was slightly lower than the March quarter at $14.60 MMbtu. So that’s despite JCC oil and JKM prices increasing during the June quarter. Can you provide some color on why the data coming through – or that trend is softer than what we are seeing in the market, particularly if there is arrangements in contracts such as extended lag pricing or gas banking from offtakers that explain the trend? Meg O’Neill: Yes, Tom, it’s really a question of mix. So, we sell LNG on a variety of price indices, Brent, JCC, some of the gas hub indices as well as we have one gas contract that is – we call it a pseudo fixed price contract and quarterly outcomes is just a result of the mix of the portfolio at any point in time.

Okay. I wanted to follow that up offline for a little bit more. Thank you for that. Just quickly then one on Scarborough, if we could get an update on Scarborough gas contracting, obviously, it’s a strong market to sell LNG. We have seen numerous long-term LNG SPAs announced from new LNG coming along in the U.S. from 2026 over the last few months, but nothing yet on Scarborough. Any feedback you can share on that process and how the gas marketing team is going on that front? Meg O’Neill: Sure. We continue to talk to a number of players about Scarborough. We are talking to a variety of potential buyers. And when we have something that’s announceable, we will communicate to the market.

Okay. No worries. Thanks, Meg. Meg O’Neill: Thanks, Tom.

And your next question will come – sorry, the next question will come from Mark Samter of MST.

Yes. Good morning, everyone. Apologies if I ask questions that have been already covered in the session. I was in the Father’s Day breakfast. First one, I think is around the Scarborough sell-down. It’s been going on 13 months that from the start – when you told us publicly that it has commenced, and not saying the press is always right, but there is some press, I think, a week or 2 ago saying it wasn’t going so well. Can you tell us where that process is at, if you’re still expecting to sell down to 50%? And how much maybe challenges in that sell-down process has driven the 10% to 20% gearing target? Meg O’Neill: Yes. Thanks for the question, Mark. Good to speak with you, again. We continue the sell-down process as we have communicated our goals with the processes to find the right partner at the right price. And when we reflect on Scarborough, Scarborough is an extraordinarily important asset for Woodside. It’s going to be a significant contributor to our cash generation for the – starting in 2026 for 20 years – 15 to 20 years after that. So it really is important that we get the right partner and we get the right price. So we’re not going to be schedule-driven with this process. We do continue to have discussions with a number of high-quality prospective partners, and we’ll continue those discussions and hopefully land something. But again, we’re not going to fire sale this critical asset.

I mean, would it be a fair to [Technical Difficulty] nothing done after 13 months that maybe you’re not seeing offers at the level of the price that you believe is the fair price? Is that a fair interpretation? Or we still not had any bids tabled after 13 months? Meg O’Neill: Mark, we’re continuing to work it. The calendar – I guess you can sort of debate how long we’ve been trying to sell it down. We had a pretty hard push ahead of FID. And then after FID, we took a bit of a pause because with that milestone, we have significantly de-risked the project. So post FID, we’ve seen players come to us. And we continue to have interest in the markets, particularly as the LNG marketplace changes globally. So we’re continuing to talk to a number of high-quality potential partners, and hopefully, we’ll be able to land something.

Okay. Great, thanks. And then just on the $9 billion in the CapEx of 2024. We’re saying that it’s just for Sangomar and Scarborough as much Pluto 2. Is there anything you can say on the rest of the business CapEx just on base business? Because I guess when I think about that 10% to 20% gearing target – is it again, fair to assume that the oil hedging you’ve done is as great as gearing is now, when you’re returning as much capital in dividends as you have this half? Oil goes to $50, $60, $70 and port LNG comes down a bit all of a sudden, you’ve been reasonably materially free cash flow negative over that period. Is there any color you can give on rest of business CapEx for the next couple of years as well? Meg O’Neill: Yes. Thanks, Mark. Look, the $9 billion is, as you note, just for the major projects, the Sangomar, Scarborough, Pluto Train 2. We haven’t put guidance out for the rest of the capital profile. We have provided guidance for 2022 full year. And from that, you can get a bit of a sense of baseline capital, but we will provide the market with more information as we head into 2023 around what the baseline capital looks like in that time period. I’ll address your comment as well on hedging. You’re absolutely right. The reason we have hedging in place is to protect against a price shock. And that’s one of the tools in our toolkit as we head into this period of higher capital spend, to ensure that we have resilience and we’ll be able to protect the balance sheet in the event of a price shock. And as well as we do that, it was only 2 years ago that we were at record low pricing. So we think that’s a prudent step to protect our balance sheet.

Yes, absolutely. Congrats again. Just one really quick question then if I can on Sangomar, obviously, having to move the FPSO to a different country. I presume that’s a logistically challenge. How much issue does that create with – because I assume the shipyards are owned by a different party – how much issue does that create with the liability over work, and particularly schedule around that, too. I would’ve thought that’s a pretty costly MB timely process to go through. Meg O’Neill: Yes. Thanks for the question. Look, the key driver for moving the FPSO actually is to give ourselves schedule certainty. So the FPSO which MODEC is contracted to deliver is currently being fabricated in China at a number of different shipyards. All of the elements are being integrated as we speak. The reason for repositioning to Singapore actually allows us to get after the commissioning with reduced risk of COVID-related disruptions. And just to describe a little bit more detail, this phase of the project, when you’re in the commissioning phase, you need tremendous support from all of the different equipment vendors, and the travel restrictions in China make it a bit difficult today to do that. So moving the FPSO to Singapore actually gives us greater schedule confidence that we will be able to complete this really complex portion of the late-stage construction. And the contracting and responsibility for that lies with MODEC. We’ve, of course, been closely working with them to understand the plans, but we fully support it, and we think it does actually improve our schedule certainty and keeps us on track for that 2023 first oil.

Got it. Thank you, Meg. Meg O’Neill: Thanks, Mark.

And the next question will come from Dale Koenders of Barrenjoey.

Good morning, Meg and Graham. I guess I just wanted to expand on Tom’s question, when you asked Meg about the balance between returns and future expenditure. Your answer was purely focused on seeing the balance sheet up for further investment. And I look at Slide 24, and I be reading too much into it about excess capital, special dividend share back from future investment, future investments is the only one with a tick. And then your capital allocation framework, most people will talk about returns on that slide, you’ve only spoken about what you’re spending money on. Just can you give us some certainty about what returns will come going forward? Or is this really a pivot of the company is shifting more towards growth going forward? Meg O’Neill: Yes, Dale. So as we have said before, when we put this slide out, one of the things we want to do is ensure that we’ve got a variety of tools in the toolkit to return value to shareholders. Special dividends would fit in that category. Buybacks would fit in that category in addition to our existing dividend policy, which provides a pretty healthy returns to shareholders, particularly when we pay out at this 80% ratio that we’re providing today. When we looked at the current financial position, we said, the right thing for us to do at this point in time is to focus on returning value through that dividend at the upper end of our target range, and preserving the ability to do future investments. It’s not to rule out the possibility of specials or buybacks in the future. But again, when you set the guardrails of strong investment-grade credit rating, that target gearing range and the dividend payout, this is the recommendation that we’re out for today. But again, the door is open as we go forward in time to looking at some of those additional levers. Maybe I’ll ask Graham to elaborate a little bit.

Yes, sure. Thanks, Meg and thanks Dale for the question. I think I don’t want to get caught up into the slide, the ticks of what we’ve sort of achieved for this period. But I guess the emphasis of the capital management framework and the gearing ratio of 10% to 20% is really to provide that ability to be able to return value to the shareholders, while being able to continue to invest in our major projects over the next few years. Gearing is definitely a point in time. And when we are determining dividends and shareholder returns, management is looking forward. We’re looking at sort of the business circumstances. We’re looking at forward pricing. We’re looking at our capital obligations, and we balance that up to be – to provide balanced returns to our shareholders as we move forward.

Okay. Maybe just changing tack on to the LNG, 18.5% year-to-date, still full year 20% to 25%, indicating sort of second half, 25% to 30% exposure to spot pricing. Is that higher rate more indicative of what you’ll be seeing in ‘23 and going forward? And then a second part to the question in terms of your hedging program where you sort of announced a bit on your LNG contracts. Can you talk a bit more about the timing? And are you effectively locking in the large spreads we’re seeing today? Meg O’Neill: Yes. Thanks, Dale. So first off, we haven’t put out any guidance for 2023 gas hub pricing. We will put that out for our normal course of business at the end of the year, probably during our investor briefing day. So we haven’t signaled that. When it comes to hedging, what we have done, and I think the hedging is pretty comprehensively disclosed in the report is, we’ve placed a number of hedges on oil indexation. And again, as I commented in Mark’s question, the purpose of that is to protect the balance sheet in the event of a price shock. For Corpus Christi, the hedging that we have put in place locks in positive returns.

Okay. You can’t give any more steer on sort of have you been looking in better returns that you’ve been making in prior years? Meg O’Neill: Look, I’d encourage you to look at the segment reporting. I think what you would see is that our marketing segment actually did a pretty positive result in the first half of this year.

Okay, thank you. Meg O’Neill: Thanks, Dale.

The next question comes from Gordon Ramsay of RBC Capital Markets.

Thank you very much and congratulations on a strong result, Meg. Capital management, in particular, the dividend policy, isn’t it time for Woodside to update its policy? I mean 50% of underlying NPAT and you’re paying 80% the last few years. Is there any thought to moving to a free cash flow based dividend, and one that takes into account growth CapEx and other priorities in the company so that there’s some improved visibility going forward on what the dividend may be? I mean, some of the majors or even have floors on their dividends? And will you guarantee buybacks if the oil price is above a certain level? Any thought about improving that dividend policy and making it more visible for investors? Meg O’Neill: Yes. Thanks for the question, Gordon. Our finance team has done really extensive modeling of dividend options. And we believe that the dividend policy we have, which is to pay out on NPAT, is one that is appropriate for us, and it’s something that we’ll be enduring through the cycle. But I’ll let Graham elaborate a bit on the choices that we’ve contemplated and why we’ve stuck with what we have.

Thanks, Gordon. And – look, we’ve – as a part of reviewing the capital management framework across – or post the merger, we’ve tested it across multiple scenarios – multiple price scenarios, business scenarios, etcetera. And as Meg is saying, we still believe that this is – using the EBIT or the NPAT measure is still the best path forward for the organization, as we move forward.

Okay. Thanks. And Meg, on Sangomar, I mean, there’s nothing in the presentation in terms of target start-up date, but I heard you say earlier, are you still targeting 2023 for first oil from that project? Meg O’Neill: Yes, we’re targeting second half of 2023.

Okay, that’s all for me. Thank you. Meg O’Neill: Thanks, Gordon.

Your next question will come from Mark Wiseman of Macquarie.

Hi, Meg. Hi, Graham. Thanks for the update. I just had a couple of questions. Firstly, on Sangomar. I just wondered whether the CapEx on that project has changed, the prior guidance with the move of the FPSO? Meg O’Neill: It has not.

Okay, okay. Great. And just on the Trion project, I’m just interested in – you’re talking to an FID in Cal-23. I’m just wondering, would you consider selling that down, bringing in another partner prior to FID? And I was just wondering, could we discuss some of the supply chain issues? It sounds like you’re being a little cautious, if I’m correct, just on the costing of that project going into an FID? Could you maybe just elaborate on that? Meg O’Neill: Sure. Look, I think it’s appropriate to be cautious heading into any FID of this magnitude. With Trion, we have completed the FEED work, so the front-end engineering work. But the marketplace that we are in today is a very different one from the marketplace when FEED was started, which was about a year ago. We are seeing inflation through the supply chain. We are seeing uncertainty in delivery times. And these are – sorry, just to clarify, these are four projects that are being quoted today. Of course, projects like Sangomar and Scarborough are past that point of uncertainty. So, what we want to do with Trion is make sure that we have got a really good understanding of the cost, and we are reviewing the contracting approach. We are looking to get greater confidence in the cost estimates. So, that’s a significant piece of work that we are doing in the intervening period here. In terms of our ownership stake, right now, we have got 60% with PEMEX, the national oil company holding the other 40%. As I alluded to on the capital management slide, one of the pieces of work we are doing right now is taking a look holistically at our portfolio. But at this point in time, we are not pursuing sell-downs for Trion.

Okay. That’s great. Thanks. And just finally, on Trion again, is there any ability to slide that back to better marry up with your gearing target in terms of just – as some of the CapEx on Senegal is coming off, it would be nice to have Trion more in 2024, 2025 and less so in 2023? Is there an ability to push it back? Meg O’Neill: So, we are looking very closely at the impact that Trion would have on our capital outlook and on the balance sheet, and on our gearing range, would be premature to comment on potential timing changes at this point in time.

Alright guys. Thank you.

The next question comes from Nik Burns of Jarden Australia.

Thanks. Just a question on the Scarborough sell-down process. Can you just walk through how you are thinking on the appropriate level of upstream equity and the project has evolved? The world has changed a lot since you flagged selling a 50% stake a year ago. We have seen some of your peers finding it challenging to close the gap in terms of price expectation, in particular for projects that are a few years away from first revenue. Your capacity to retain a higher equity piece must be increasing by the day as LNG prices increase? Should we be shocked if you announce in the future that you plan to retain your entire 100% stake? Meg O’Neill: Thanks for the question Nik. As I have said, I think to Mark’s question, with Scarborough, it is an extraordinarily important asset for the future of Woodside. And so, as we think about reducing our equity position, we want to ensure that we bring in the right partner. So, that’s somebody who shares our vision of the asset and shares our desire to progress the assets. We want to make sure that we get fair value so that our shareholders get appropriately financially rewarded if we do dilute our interest in this opportunity. So, we are not being scheduled driven. That said, given the LNG market conditions today, we are continuing to talk to a number of really high-quality prospective partners, and we will update the market when we have something firm to say one way or the other.

Got it. My other question just relates to the BHPP assets. Since the merger information was sent to Woodside shareholders back in May, we have had some negative updates from you in terms of some of the growth projects acquired from BHP, either no longer going ahead or being pushed back. Can you just talk through why you still believe the merger was a good one for Woodside shareholders from a relative value perspective? And which of the BHP volume growth projects are you most excited about? Thanks. Meg O’Neill: Well, I think you look at our results, Nik, and that is pretty clear as to why the merger is good for Woodside shareholders. The strength of our financial results underpinned by increased production at a point in time where the world needs the products that we produce, the strengthening it provides to the balance sheet which allows us to continue progressing the investments that are already underway. It unlocks our ability to invest in new energy opportunities. And we see the opportunity to capture cost synergies by bringing the two businesses together. So, I think the strategic rationale for the merger remains very positive. Obviously, with any business, things will change a little bit over time, but the overall assets, as we get to know them better, we are very pleased with what we have brought into the business. As we think about future investment opportunities, as I alluded to, we have quite a few things in the hopper, and that’s actually a really great place to be. So, in addition to Trion, we have got Browse and Sunrise, which were heritage Woodside or legacy Woodside assets. We have Calypso, which is a deepwater gas field in the Caribbean. And then we have got a number of new energy opportunities. So, it’s actually a really pleasing place for us to be able to have a bit of choice and to have optionality in terms of future investments.

Got it. Thanks Meg. Meg O’Neill: Thanks Nik.

And the next question comes from James Redfern of Bank of America.

Hi Meg. Well, just two quick questions, please. You mentioned before that Woodside is going to be undertaking a strategic review of all the assets post the BHP Petroleum merger. Should we read that some of the maybe smaller margin or mature assets might be divested, such as maybe the Australian oil assets? And I have got one more question, please. Meg O’Neill: Look, the strategic review – we will take a look at everything in the portfolio and help to inform our thoughts around prioritization, resourcing and where we focus heading into 2023 and beyond. It would be premature for me to conclude anything coming out of that review as it’s just getting underway.

Okay. Perfect. And second one, please, Meg. Obviously, Woodside is in a much stronger position now, which is great, particularly post the merger. But obviously, the natural field decline in North West Shelf is still an ongoing issue, and the backfill from the Browse project is one option. Just wondering if you could please sort of maybe step through what the biggest issues are for developing Browse, whether that would be having a carbon capture storage solution, joint venture alignment or the economics of the project, if you were to sort of, I guess call it the biggest hurdle, before we could see potential FID in a few years’ time for Browse? Thank you. Meg O’Neill: Okay. Thanks James. Let me first comment on North West Shelf. I am really pleased that through some great work by the team, we have been able to actually refill the Karratha Gas Plant. So, with Greater Western Flank 3 and Lambert Deep starting up earlier this year and processing gas from Pluto, the Karratha Gas Plant is once again full. That’s only going to last for a few months, but kudos to the team for hard work to bring all of those projects to fruition. And Pluto is quite significant and that it is the first opportunity for the Karratha Gas Plant to process gas for others. And hopefully, that will open the doors to other gas resource holders bringing their products to our facility. When it gets to Browse specifically, there are three things we are working on. One is carbon. The CO2 in the Browse reservoir gas is, we will call it, circa 10% average across the various fields. In today’s world, we need a CCS solution, and we have been working on that. And you would have heard that we received a permit to be able to progress CCS in Browse. So, that’s good progress on that front. The second item we are working is environmental approvals. Those are progressing through both State and Commonwealth regulators. Obviously, a lot of interest from a variety of external stakeholders in those approvals, and we continue to work with the regulators on managing those public comments that were provided. And the third issue is the gas processing agreement between Browse and North West Shelf, and those commercial discussions are underway. Would be premature to try to forecast any time for which those agreements would conclude. But those are the first three things that we need to get sorted out to be able to move Browse forward.

Okay. Thanks Meg. Meg O’Neill: Alright. Thanks James.

The next question comes from Saul Kavonic of Credit Suisse.

Hi Meg. Hi Graham. I just have kind of two areas I want to ask a couple of things on. But first of all, just want to focus on the LNG spot exposure, given spot LNG is several times the equivalent price of oil at the moment. You talked about 20% to 25% hub exposure in the second half for the year versus 18.5% for the first half. So, that’s just 21% to 26% hub exposed for the second half. Should we expect that level of exposure to be maintained to increase in ‘23 as well with the interconnector up, so we are going to see increased spot exposure? And could you also touch on when the Pluto contracts roll off? And if we should be – what year do we expect the Pluto volumes are going to be have the new kind of hub exposure at the moment? Meg O’Neill: So, we will provide guidance on the 2023 outlook for gas hub exposure, probably at our Investor Briefing Day in December. So, that will be part of our normal guidance process for the coming year. So, I am not going to comment on that any further today. The Pluto contracts, look, we will need to get back to you on that. Sorry, I don’t know that we have disclosed that previously.

Okay. And just quickly also, are you seeing signs that long-term LNG price assumptions being used by industry are increasing, whether that’s for contracting purposes or for asset M&A purposes? Meg O’Neill: Well, the short answer is yes. If we contrast to where we were 2 years ago, there were deals being done, we will call it, with slopes in the 10s. What we are seeing now is an uptick from that level. It would be inappropriate for me to comment on specific numbers, but we certainly have rebounded from the lows that we were at in 2020.

Alright. And just my second question is about the outlook that was provided as part of the merger documentation. There was 5-year outlook provided for production, free cash flow and operating cash flow. I just want to confirm with you if – price assumption side, if we assume the same price assumptions, has that materially changed in any way, or can we still expect roughly speaking, on that chart, about $4 billion in free cash flow under those price assumptions for the next several years before growth comes in line and increases that from 2027? Meg O’Neill: Look, we will have to circle back with you on that, Saul. So, the documents we put out with the merger were not guidance. They were indicative. But we will need – so we will need to circle back to you with any updated guidance that we might put out to the market.

I mean I guess the question on that is, if you are going to have $4 billion in FDI [ph] per year, and that’s roughly kind of what your annualized rate is now, I mean is it reasonable to expect the price assumptions you put out early in the year, and price has only got better since then, that Woodside can sustain a dividend yield of 9% for the next indefinite period? Meg O’Neill: I mean the yield is a calculation of two numbers. So, it kind of depends on what our share price does over that time period. Look, as I have said, we are not going to provide guidance on free cash flow. That’s not something we typically do. The merger explanatory documents were intended to help shareholders understand the opportunity presented by the merger.

Understood. And the last question on this is the new guidance, the guidance that’s been put out to your $125 million to $153 million, if we adjust that to the old conversion factor, adding the BHP production until May, you get a range of 190 million barrels to 198 million barrels for the calendar year ‘22, including the BHP assets for the full year. That’s a bit soft on that outlook chart of – it’s about just over 200 million for 2022. Can you explain why there is a difference there? And I guess a broader question here is, we have had nothing to go on except this 5-year outlook. So, if we are modeling to these outlooks, we want to get a sense of if there is risk to the upside or downside from those outlooks, because it already looks like in 2022, there has been a slight miss versus the outlook for 2022 presented in that chart earlier in the year. Meg O’Neill: Yes. So, the chart provided earlier in the year, again, as I have said, the explanatory memorandum was to help investors understand the potential value of the merger. It wasn’t to be providing specific guidance for what it’s worth your mouth, 190 million to 198 million versus squiggle 200 million is pretty much either bang on or in the range. Look, I think the point in time, Saul, we will provide another view of where the company is headed will be at that Investor Briefing Day in December.

Okay. Thanks Meg. That’s all for me. Meg O’Neill: Thank you.

And the next question will come from Daniel Butcher of CLSA.

Hi Meg. I had a couple of – one on exploration, one on spot LNG. Just on the exploration side of things. I think your exploration CapEx guidance before the merger was $50 million and now after the merger, it’s $400 million to $500 million. And just to reconcile that, first what the difference being spent is and secondly, reconcile that with your synergy target of $400 million, which includes $200 million of CapEx on exploration and other low return projects being saved. So, could you maybe explain where that extra CapEx on exploration comes from? Meg O’Neill: Sure. So, the heritage BHP business does have some exploration commitments in the back half of this year. I think we have signaled some of those in the reporting. The Hulu wells, for example is one that is going to spud in September and there is some other exploration drilling that is underway. Of course, there is a bit of seismic also in that number. So, the two heritage companies did have – did view exploration a bit differently within their portfolios. The Woodside exploration portfolio was quite limited, and that’s why our guidance heading into this year was relatively modest. So, we do have activity. It’s largely focused in the Gulf of Mexico, so oriented towards what I would call the heartland of our new merged business. From a focus perspective, one of the things we are going to be doing is ensuring that our exploration activities are very clearly oriented towards assets that can be matured quickly. And I think our industry, unfortunately, has a bit of a track record of finding things where you have a technical success, but commercially struggle to move them forward. So, part of the exploration or part of the activity that we are doing as we bring the two exploration groups together, is to ensure that we have that right focus. And for 2023, we will put out guidance that will give you a feel for how exploration fits within our overall spending outlook. But the spend for the rest of this year largely is some legacy commitments that had been made as we were heading into the merger.

Okay. Because the marginal amount, $350 million to $450 million extra from the BHP side, the seven months, that seems like a lot more than one deepwater well plus some seismic that you mentioned. Are there any other big impact wells we should be aware of on the cards for this half? Meg O’Neill: The Hulu well is probably the biggest hitter. There have been a few other exploration wells in the Gulf of Mexico in the non-offsetting.

Okay. And just quickly, can you maybe just talk about your strategy for kind of LNG right now? Are you, for example, on the stuff going for the Pluto expecting interconnector selling that at spot, JKM or TTF hub, or are you playing on contracting some of that up in the short to medium-term? Meg O’Neill: So, the approach that we have taken down to our LNG sales is, we contract on a portfolio basis. So, we don’t have a strategy that’s dedicated to interconnector volumes. For example, we look to sell on a portfolio basis. So, one of the things that we are doing, and we do on an ongoing basis is take a look at the projected future production performance and contracts to ensure that we, first off, have confidence that our product will be lifted, but secondly, make sure that we have got the right mix of price indexation. A lot of our long-term contracts are linked to oil indexation, either Brent or JCC. And so the question for us, of course is how much do we preserve to be able to sell on a shorter duration basis using some of those gas hub indices, either JKM, MDP or TTF. So, again, the guidance for this year is that we expect to finish the year in the 20% to 25% range, and we will give the market insights into 2023 a little bit later this year.

Okay. Thank you. That helps lastly to my final question. I think last quarter, we saw the trading arms of BP and Shell make some big losses on Freeport and [indiscernible] outages. And my understanding is that’s largely because a lot of the LNG on portfolio rather than specific projects, so they couldn’t declare force majeure. And Woodside as you just mentioned has moved towards selling on portfolio as well. So, if you had a block of one of your LNG plants, how would you mitigate losses on the trading side? Meg O’Neill: Look, when we look at our existing sales, much of those – the historic sales actually are contracted from specific plants. And so, the new portfolio sales that probably represents a smaller portion of our business than some of those companies that have a more established trading position.

Right. So, most of your legacy sales are from specific plants or most of the new stuff that you are going to put on portfolio in the future? Meg O’Neill: Correct.

Thank you. And how would that apply to your future strategies as you get forward a few years in time and mostly on portfolio? Meg O’Neill: Yes. But the point you make about making sure we are positioned for operational upsets is a very important one. It is something that we look at as we decide how much do we want to have contracted and how much do we want to have available for flexible sales, just to account for some of those ups and downs that you might experience in an operational plant.

Okay. Thank you. I will leave it there. Meg O’Neill: Okay. Alright. Well, thank you all for joining us on the call. Sorry. Go ahead.

Oh. No. I was just going to take back to you was there any closing remarks. Go ahead. Meg O’Neill: Okay. Alright. Well, thank you all for joining us on the call today. I am looking forward to meeting with many of you in the coming weeks and providing an update on our strategic direction at our Annual Investor Briefing Day in December. Thank you.

That does conclude our conference for today. Thank you for participating. You may now disconnect.