Iran Israel ongoing conflict has raised fears about potential supply disruptions has left oil prices soaring further, bringing into focus ASX 200 Energy Stocks. The escalation in tensions has come at a time when there is a spike in oil demand because of another unrelated development, of a U.S. major storm, Hurricane Milton, hitting Florida.
Energy stock companies that have since been drawing attention of investors are
Woodside Energy Group Limited (ASX: WDS)
Woodside Energy Group Limited, on half-yearly basis reported production growth year on year with increment in production cost. However, production cost between H1 2023 reduced from $8.8 boe from H1 2023 to $8.3 boe. Group reported EBITDA of $4.4 billion, driven by strong operational performance and gain on sell-down of interest in Scarborough Joint Venture.
On an average company has managed to maintain cash margin of 80% between H1 2020 to H1 2024. Liquidity of $8.5 billion and gearing of 13%, at the lower end of the target range supports capital investment and returns.
$2.4 billion operating cash flow, continued strong performance .136% growth in FCF to $740 million benefitting from sell-down of interest in Scarborough Joint Venture. Group ROE increased by 1.3% on pcp to 11% and EPS was up by 11% on pcp to US 102 cps. In 1H 2024, WDS reported fully franked Interim dividend of $1.3 billion, representing a half-year annualized dividend yield of 7.3% Maintaining 80% payout ratio, top of the target payout range.
Woodside is one of the Best Energy Stocks, having recently commenced oil production from its highly anticipated Sangomar Oil Project in June 2024, marking a notable advancement in its strategy for production expansion across its operational portfolio, where this new initiative is expected to play a crucial role. The company is actively evaluating additional organic resource growth opportunities and is continuously reviewing its portfolio with the aim of achieving further increases in oil production in the future. Concurrently, the Scarborough and Pluto Train 2 project are also 62% complete, with plans to deliver the first LNG cargo by 2026. Additionally, the Trion project is making significant strides, with the first oil production anticipated in 2028. Woodside's overall exploration efforts also remain vigorous, focusing on the discovery of new projects within its pipeline to support long-term growth.
Woodside's solid operational foundation, coupled with its historical financial growth, has resulted in a threefold increase in revenue and nearly a fivefold rise in earnings over the past five years. This strong performance has strategically positioned the company to provide substantial financial returns to its shareholders.
Karoon Energy (ASX: KAR)
In its recent half-yearly results Karoon Energy, which faced three week scheduled maintenance shutdown, FPSO reliability issues, the continued outage of SPS-88 and expected natural decline reported 8% sales volume growth but overall production was down by7% on pcp.
The company declared an inaugural interim dividend of AUD 4.496 cents per share (fully franked), representing a 21% payout ratio. KAR commences a share buyback of a US$25 million share.
While the negative half-yearly performance raises questions about the company's short-term results, its five-year performance graph shows a solid cash position, strong cash flow from operations, strong free cash flow, and favorable net margins. Additionally, the company's interest coverage ratio stands at 23.17, and its debt-to-equity ratio is 53.4%, demonstrating its financial stability and resilience.
The Who Dat East well, which was drilled in early 2024, encounterd valuable gas-condensate but is now put on hold as a potential future producer. The Seadrill West Neptune is expected to start drilling the Who Dat South well in September, and Who Dat West is planned for later in the year.
In Brazil, the Neon project is advancing with new 3D seismic data aiding reservoir modelling and well planning. This work supports the year-end reserves review and a possible FEED entry decision in early 2025.
Continuous FPSO activities are ongoing at the Baúna project. The SPS-88 well intervention has been postponed to the first half of 2025, pending contracting and regulatory approvals, with the well expected to return online by mid-2025.
Source: Company’s Report
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