Woodside is postponing final investment decisions for its three LNG growth projects worth more than $50 billion in a response to the oil price crash and the Covid-19 pandemic.
The projects in question include Scarborough, Pluto Train 2 and Browse LNG.
The Australian company announced a number of measures on Friday including a 50 percent reduction in spending for 2020.
The current uncertain global investment environment arising from the spread of Covid-19, combined with oversupply of crude oil and LNG, has led to significant decline in prices.
This requires a “decisive and swift action,” Woodside said.
The company will reduce spending to about $2.4 billion and about $100 million in operational spending.
As part of the measuers, Woodisde aims to reduce investments for about 60 percent to $1.7 – 1.9 billion.
Besides delaying final decisions on its large LNG growth projects to 2021, Woodside will also postpone other activities.
These include most proposed exploration activities, reducing overall exploration expenditure by about 50 percent to $75 million.
Woodside said it would continue finalizing commercial deals and regulatory approvals for Scarborough, Pluto Train 2 and Browse.
The company also noted that there would be some ongoing engineering work in preparation for a FID on these projects.
The Covid-19 pandemic has affected the entire industry.
Woodside CEO Peter Coleman said all steps were being taken to “protect the wellbeing of those who work for and with the company”.
“These are extraordinary times, that no one could have foreseen,” he said.
But Woodside enters this period of uncertainty with one of the “stronger balance sheets” in the industry and low-cost producing assets, which are resilient to commodity price fluctuations, Coleman said.