Word got out on Friday that Woodside Petroleum Ltd [ASX:WPL] is under investigation by the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA).
Woodside Petroleum is Australia’s largest independent oil and gas company.
NOPSEMA is investigating Woodside Energy in relation to the removal of old offshore oil equipment.
In particular, it has to do with the Nganhurra riser turret mooring in the Enfield oil field in title area WA-28-L. The area license is co-owned by both Woodside — who holds 60% — and Mitsui who owns the rest.
Woodside had planned to dispose of the infrastructure by transporting it to land to decommission it but it can no longer do so as the infrastructure isn’t stable anymore.
As Energy News Bulletin reported:
“We had secured approvals, awarded contracts, and mobilised vessels to undertake the activity,” a Woodside spokesperson told Energy News.
‘During this process, Woodside identified an “issue with one of the ballast comparments,” meaning it could not tow the riser turret mooring as planned.’
Woodside has revised their plan to decommission it by turning it into an artificial reef. While NOPSEMA seems onboard with the new plan, they had this to say:
‘NOPSEMA has accepted a revised Nganhurra Cessation of Operations Environment Plan by Woodside, for the decommissioning of the Nganhurra riser turret mooring from title area WA-28-L. Through accepting the environment plan, NOPSEMA has required Woodside to implement a range of protective measures to prevent and mitigate impacts to whale sharks, turtles, and seabirds.
‘In addition, NOPSEMA has initiated regulatory compliance action due to Woodside being unable to comply with an originally approved plan to remove the equipment for onshore disposal.’
What could happen next?
So far markets have taken the news well, as the WPL share price increased by 0.9% at time of writing.
But Woodside has had quite a hit from the pandemic after oil collapsed. They had to write-down around US$4 billion in assets because of drops in prices of oil and natural gas. It’s been a tough year for oil companies with demand and oil prices collapsing, and less investment going into the industry.
Share price for WPL has decreased 24% in the last 12 months.
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