Coming up on the SPS on the Money podcast, a special extended edition because we've got two special interviews. The CEO of Woodside, Meg O'Neal, and the CFO of BHP, Vandita Pant. They'll tell us about the company's results and economic outlooks. Plus, CSL splits into two. Share price takes a huge tumble. We'll have all the details next.
Hi everyone, welcome to the SPS on the Money podcast for this Tuesday the 19th of August 2025. It's a day where the Australian share market fell. The S&P ASX 200 off by 0.7% but CSL really sucked the blood out of the share market. Its shares down 17%. Julia Lee from Footsie Russell will have the details later in the podcast. But first to two special interviews later, BHP CFO Vandita Pant. But first, Meg O'Neal, the CEO of Woodside Energy. Shares in the company down 2.8% today as it posted a halfyear underlying profit of 1.25 billion US, which is down 24%. But to find out more, including her take on the global economy, AI, and the government's economic roundtable, here is my interview with Woodside CEO Meg O'Neal.
Meg, first of all, I'd love to get your take on the external environment before we talk about results. How you're seeing the global economy navigating this tariff uncertainty first of all, and what it means for the commodities that you produce.
Look, it's been really fascinating to watch. I think back in April when the tariffs were first announced, there was a huge market shock. That said, there's been a pretty muted response since then. When we look at our key products, so oil and natural gas, probably the bigger impact for oil has been OPEC plus unwinding some of the production cuts that they've imposed. So more oil coming into the marketplace. That's put a bit of downward pressure on prices. But there's a geopolitical overlay to all of that. You know, what's happening in the Middle East, what's happening in Russia, what's happening with sanctions. So, we always watch a lot of those factors when we think about the oil markets. Natural gas has been strong throughout and that's been really fascinating to watch. So, when you look at our results, we always try to save a certain amount of our LNG to sell on the gas spot market. And the prices that we've got for that product is much better than the LNG that we sell when it's oil indexed. So much of the LNG market is tied to oil pricing. But the call 25% that we sold on gas on gas pricing got a $3 better price. So, you know, really strong results from the gas market and as we head towards the fourth quarter, which is winter in the northern hemisphere, that's when gas demand typically grows. So we do expect to see pricing continue to strengthen particularly for gas as we head towards the back end of the year.
On the results, you say you've taken a disciplined approach to future growth and reduce spend on new energy and exploration. Can you talk me through that strategy?
Sure. So over the last year we made a couple of really big acquisitions. So we acquired a company called Turan in the US that's a developer of an LNG project. We've renamed it Louisiana LNG and we took a final investment decision on that in April of this year. We also acquired a low-carbon ammonia plant which we call Beaumont New Ammonia. So very significant investments in the US and these are investments that are going to generate value for our shareholders through the 2030s. So it's about setting the company up for the future. But with this big capital investment underway, we've realized that we need to tighten our belts in other parts of the business. We need to make sure that we protect the strength of the balance sheet, that we can also return dividends and value to shareholders through the cycle, and continue these growth investments. And so that's why we've ramped back some of the other spending in things like exploration and new energy, recognizing we need to focus on delivering the projects that we're investing in today. And we'll be able to look at new things once we get through this big wave of spend.
So, does that mean this disciplined approach rules out another tilt at assets like Santos?
Yeah. Yes. Look, I think we took a look at Santos back in '23 and you know what we found attractive was their LNG business. But we've moved on and last year with the acquisition of Louisiana LNG, actually that gives us a very material LNG footprint in the Atlantic basin which complements our Pacific basin and we think there's actually a greater value uplift from being in the two basins instead of being concentrated in the Pacific. So yeah, we're very focused on delivering on that strategy and delivering that uplift in LNG production for our shareholders.
Are you able to give us an exact update on where you are with that Northwest Gas Shelf expansion?
Sure. So, you know, we were really pleased when Minister Walt was appointed that one of the first decisions he took was to issue a preliminary decision approving the life extension. What is important for us though is that we have conditions that are scientifically rigorous and technically implementable. And if you go back, we have a similar approval for exactly the same life extension from the WA state government. That went through a vigorous six-year assessment process and issued conditions that meet those two criteria and that's what we want to see mirrored in the federal approval. So yeah, we're continuing to work with the government and the department to ensure we get a workable approval for all parties concerned.
Two final questions. The economic roundtable starts today in Canberra. From my understanding, you've got a representative and board member Ben Wyatt there, but I think over the next couple of days, what's your message to government and stakeholders taking part and how do you make sure this doesn't just turn into a bit of a talk fest on productivity and get something actually done on it?
Yeah. Well, I can't answer the second question. You'll probably need to turn that to the treasurer. But, you know, we are here. We are ready. We want to be part of the solution. Look, our key message is around the importance of energy. So energy is essential to tackling cost of living today, to ensuring Australia's industry today continues to be prosperous, to underpinning things like a future made in Australia, critical mineral processing, even AI data centers are energy hogs, and we need to continue investing in energy. You know, yes we need to be tackling emissions and delivering on our commitments of the Paris agreement. But the future gas strategy is very clear that renewables need gas to provide the reliable and affordable power that Australians need. You know that power is essential to economic prosperity. But there's barriers. There's too many barriers. Red and green tape and Northwest Shelf is a great example. So you know state and federal approval for the same thing. Six plus years for the state. We're flirting with seven years for the federal government. You look at the next big gas field we're trying to develop, the Browse gas resource. The environmental applications have been with those same two bodies since 2018. So approaching seven years. We've just got to tackle the inefficiency and bureaucracy that is slowing down investment in energy that would power Australia's future. So that's our key message.
Final question. When I speak to analysts ahead of reporting season they say find out three things from these CEOs that you speak to. And we spoke about the US economy, the global economy and tariffs. The other thing is about the consumer but with just a bit of time to round out the interview I want to talk about AI. They said find out what's doing in the AI sphere, whether it be to help innovate or to help with productivity.
Yeah, a lot of work actually across the organization. So we've got examples from in the base business using AI to help with diagnosing the root cause for a plant trip. So if a plant goes down, the old way would be the engineers and the operators would pour through a lot of digital logs trying to figure out what exactly happened. AI speeds that up. So improving the operations of our business. Safety. We've got great examples of being able to go back over incidents over years and understand what are the themes that we've picked up and how do we adapt our safety practices going forward. And then in a lot of the administrative space, ensuring that routine tasks are done efficiently and trying to automate those routine tasks. So again we've got AI deployed and AI projects all over the business. And look I think it's really exciting. It'll help remove dull work from people's table. It'll help improve business outcomes. So, both the top line, the revenue line, as well as the cost line. So, super excited about AI.
That's Meg O'Neal there, the CEO of Woodside Energy. From one resource company to another, BHP, Australia's second largest listed company. Shares rose 1.6% today. It posted a 26% fall in underlying earnings despite record iron ore and copper production. For more, I spoke with the CFO of BHP, Vandita Pant.
Vandita, first of all, record production. How would you describe the last financial year in the context of this uncertain and ever-changing economic environment?
A very strong year in spite of, as you rightly said, some challenging context out there. We had industry-leading margin, strong cash flow, attributable profit of $10.2 billion which all enabled us to declare a dividend of 60 US cents per share which is 92 cents in Australian dollars as the final dividend. This dividend was more than our minimum payout ratio of 50%. If I were to take a step back on the operational side across our businesses, we had a very strong operational year as well. Western Australia Iron Ore had a record shipment and record production and continues to be the lowest cost iron ore business in the world for the sixth year in a row. And across our copper assets, fantastic performance led to 2 million tons for the first time as record volume production out of copper, which leads to 28% growth in just last 3 years. Very strong results across the business.
In the release it said BHP says that the global economic outlook is mixed. How so? And what does it mean for Australia especially in the context for the materials in which you supply and a bit of a commentary on China?
Yeah, sure. Overall the economic outlook is mixed because it diverges from region to region. For China, first half was very strong, 5.3% growth rate, and we think across the year China will end up with around 5% of economic growth with very strong commodity demand coming out of China both for copper and iron ore for steel which has been quite a stable end use industry in China. If I were to go to India, India continues to be the fastest growing major economy in the world. Very exciting because we see structural demand growth continuing to increase in India for not just metallurgical coal but also for copper and potash. If I were to go to developed world over next 12 to 18 months, because of stimulus of fiscal policies and some of the industrial policies coming through along with loosening of monetary policy, we think the growth will also come in. So overall looking at around 3% growth for world economy.
You mentioned potash. When I spoke to my analyst today for the news, she and I asked her what's the one question you would ask BHP if you had the chance. This is what she said. She said ask how important the Jansen potash project is and what its product mix will look like in 5 years time.
So look, we are very excited being in potash. Potash is a very attractive commodity because it is based on structural mega trends of higher population, better diets, and less arable land which requires potash. So structurally very attractive commodity. Jansen within that will be a low-cost asset with a life of more than 50 years. So Jansen as an asset will be a multi-decade fantastic business for BHP because it will be at the low end of the cost curve. For Jansen we have announced a revised cost and schedule and we're looking forward to our first production coming from mid-2027.
So overall you say there's a significant pipeline of growth. What does that growth look like in the coming year?
Growth capex for BHP is stable around $4 billion from here to 2030 and as we go through this growth most of it, 70% of this will be in copper. You may not know, but BHP is the largest copper producer in the world already and 45% of our EBITDA came from copper in past year. With the kind of growth we have in Chile, in Escondida which is the world's largest copper mine that we operate, here in South Australia where we plan to grow from 300 kt to 500 and then to 650, doubling the copper production, and with our project in Vunia in Argentina and a joint venture in the US Resolution as well. We have a very strong attractive high value growth in copper. We already talked about Jansen which will bring in huge growth over next early 30s. And here in Australia in iron ore as well, we had record production last year of 290 million tons out of Pilbara and we will be looking to increase that to more than 305 million tons and met coal also increasing from where it is. So huge growth in medium-term but also in long-term to the extent that for next 10 years BHP growth will be 2.2% every year.
