The Woodside Energy Group Ltd (ASX: WDS) share price went up approximately 2% today despite the oil and gas ASX share suffering from wild weather disruption.
While Woodside is a huge player in the Asia Pacific region, it also has a growing portfolio of North American projects. One of those projects has seen operations impacted by the incoming weather event, according to media outlet Reuters.
Image source: Getty Images
Shenzi production impacted
Reuters reported that Woodside has 'shut-in' its output at the US Gulf of Mexico oil platform Shenzi.
This occurred on Wednesday, caused by an onshore refinery losing power, according to a Woodside spokesperson.
Reuters reported that Woodside Energy had earlier partially evacuated staff from the platform before the arrival of Hurricane Francine.
Woodside isn't the only business to be affected. Reuters reported energy production and agricultural exports from the US Gulf of Mexico had also been disrupted, with multiple oil refineries slowing operations in Louisiana.
Port Fourchon in Louisiana, home to marine and equipment suppliers to offshore oil producers was closed to vessel projects, as was the Louisiana Offshore Oil Port. Exxon Mobil cut its Baton Route refinery output to as low as 20% of its capacity.
What could be positive about this?
While hurricanes certainly aren't positive, the closure of a large portion of oil and gas production in the region led to the US crude oil price rising by over 2% on Wednesday on fears that there could be long production shutdowns in the offshore oil sector.
Reuters referred to East Daley Analytics analyst Alex Gafford, who said oil and gas production could be affected for around two weeks, depending on the severity of the hurricane.
What is projected for owners of Woodside shares?
The broker UBS is currently forecasting that for 2024/FY24, Woodside could generate US$12.76 million of revenue, US$5 billion of earnings before interest and tax (EBIT), US$3.3 billion of net profit and pay an annual dividend per share of US$1.39. In earnings per share (EPS) terms, profit could be US$1.74 per share in 2024.
The business could finish with net debt on the balance sheet of US$3.14 billion of net debt, according to the UBS analysts.
UBS has a neutral rating on the oil and gas ASX share, with a price target of $30.70. A price target is where analysts think the share price will be in 12 months. The broker is suggesting the Woodside share price could rise by 28% from here.
