Highlights:

Woodside Energy to assume operatorship of Gippsland Basin and Kipper Unit from ExxonMobil

Woodside Energy Identifies four potential wells targeting up to 200 petajoules of gas for domestic supply

WDS Change in operatorship expected to generate estimated AUD 60 million in operational synergies

Woodside Energy Ltd (ASX:WDS) has announced it will assume operatorship of key oil and gas assets in the Bass Strait, a region historically central to Australia’s domestic energy supply. The decision marks a significant operational shift from long-standing operator ExxonMobil Corp and is projected to generate approximately AUD 60 million in synergies, according to Woodside’s estimate. The Bass Strait assets include two major joint ventures: the Gippsland Basin Joint Venture (GBJV) and the Kipper Unit Joint Venture. Both ventures are equally split, with Woodside and ExxonMobil each holding a 50% stake in the GBJV and a 32.5% interest in the Kipper Unit. The remaining ownership in the Kipper Unit is held by other joint venture partners. ExxonMobil has operated these facilities for decades and will now hand over day-to-day management responsibilities to Woodside.

In a statement to the ASX, Woodside clarified that the transfer of operatorship will not affect the underlying equity structure of the joint ventures. Existing decommissioning plans and financial provisions associated with the legacy assets remain unchanged. The move comes as the Australian government evaluates potential regulatory changes, including a gas reservation policy for the east coast. Such a policy is being considered in response to concerns about long-term domestic gas supply security, especially during peak demand periods.

Woodside noted that under its capital allocation framework, it has identified development opportunities within the Bass Strait assets. The company flagged four potential infill wells that could deliver up to 200 petajoules of natural gas to the domestic market, depending on technical and commercial feasibility assessments. These wells are being reviewed as part of a broader evaluation of the remaining resource potential in the mature Bass Strait region. While production from the area has declined over the past decade, the existing infrastructure still offers a platform for cost-effective gas recovery if new prospects are proven viable.

According to Woodside CEO Meg O’Neill, the decision to assume operatorship aligns with the company's current strategic objectives, which include optimising value from existing joint ventures and enhancing its role in Australia’s domestic gas landscape. The change is expected to simplify decision-making and improve coordination for any future development or decommissioning work in the region. Woodside Energy Group is one of Australia's largest independent oil and gas producers. Headquartered in Perth, the company has a portfolio spanning LNG, domestic gas, and oil projects across Australia, Senegal, and the Gulf of Mexico. Woodside completed a merger with BHP Group’s petroleum business in 2022, significantly expanding its asset base and production capacity.

The Gippsland Basin and Kipper Unit form part of Woodside's Australian east coast operations and have historically supplied a substantial portion of Victoria’s natural gas needs. No timeline was provided for the completion of the operatorship transition.

WDS shares were trading 0.99% higher at AUD 26.45 per share at the time of writing on 29 July 2025.