Woodside Petroleum shareholders turned out in big numbers in Perth today to listen to what the company’s top brass had to say, which included commentary on the producers recent successes and plans going forward in a lower oil price environment.

A lot has happened for Australia’s largest oil and gas company since last year’s AGM, including the failed attempt of the Shell buy-back and a decision which saw it abandon the proposed US$2.5 billion deal to purchase the giant Leviathan gas venture

However probably the most noticeable change for returning shareholders is the different market conditions facing Woodside compared to 12 months ago with oil prices having fallen from a high of $115 a barrel in June 2014 to a low of $47/bbl in January 2015.

Addressing a few hundred shareholders and invited guests today, Woodside chairman Michael Chaney said the company wasn’t banking on prices bouncing back any time soon.

“It is impossible to predict just how long this lower oil price environment will last,” he said.

“But the company is planning on the basis that it could be for several years.

“Fortunately, Woodside is in a relatively strong position compared to some of its peers, because we had already started the hard work of embedding reliability and productivity initiatives across the business at a time when the oil price was high.”

Woodside chief executive Peter Coleman echoed Chaney’s words.

“We are in a relatively strong position compared to some of our peers,” he told shareholders, citing a recent agreement to raise US$1 billion through the issue of corporate bonds.

“We’ve entered the downturn ahead of the curve and we are very determined to stay ahead of it.

“This means we are not easing up on our efforts to improve efficiency and effectiveness. In fact we are accelerating these efforts.”

Coleman highlighted some of the company’s key achievements over the past year which has included delivering record production and underlying revenue of US$2.4 billion in 2014, while on the corporate front, the company completed the acquisition of Apache’s Wheatstone LNG and Balnaves oil interests in Australia and Kitimat LNG project interests in Canada.

“The Apache acquisition is a great example of where we get immediate, near term production by adding Balnaves and Wheatstone to our Australian interests,” Coleman said.

Coleman also hinted at further M&A activity at the asset level.

“We do expect that with the lower oil price environment there will be increased opportunities for us to acquire distressed assets,” he said.

“We have strong cash flows and we’re well placed to prosper and capitalise on new opportunities in what is a very challenging market.”

Coleman also took the chance to talk up his exploration pursuits since taking the CEO reigns in mid-2011, saying he was happy with the progress the company has made in expanding its global exploration portfolio.

“Since 2012, we have increased our gross acreage to 250,000 square kilometres. We’ve entered eight new countries and we’ve acquired 26 new licences,” he said.

“In 2014 alone we entered five new countries, increasing our emphasis on emerging provinces…and providing shareholders with growth optionality.

“We now have a presence in 12 countries across a number of exciting geographies.”

Remaining true to his disciplined management style, Coleman reiterated all development options would have to stack up commercially to warrant any capital commitment.

“As always across our business we will continue to take our disciplined approach in deciding which new opportunities we pursue,” he said

“We are absolutely committed to making financial responsible decisions.”

Responding to a shareholder question about Shell’s holding in Woodside following last years failed attempt to get the Anglo Dutch major off its share registry, Chaney said the company had no plans to re-engage with Shell over the matter at this stage.

“We are not having negations or discussions with Shell,” he said.

“Since that time the share price is lower so it’s less attractive for them to sell out and also the Australian dollar has fallen a lot. We’re happy with them as a 13 odd per cent shareholder.”

While both Chaney and Coleman fielded some tough questions from a lone dissident shareholder, all resolutions at the meeting, which included the resolution of three directors and adoption of the remuneration report, were passed.

Coleman said Woodside had a strong balance sheet and exciting growth opportunities lay ahead for the Perth-headquartered company.

“It really is an exciting time to be a part of Woodside,” he said.

Woodside shares finished the trading day 0.2 per cent higher to $35.48.

Lauren Barrett can be reached at lbarrett@hartenery.com

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