Woodside has made a final investment decision to develop the large, high-quality Trion resource in Mexico. The expected returns from the development exceed Woodside's capital allocation framework targets and deliver enduring shareholder value. First oil is targeted for 2028.

The development is subject to joint venture approval and regulatory approval of the field development plan (FDP), expected in the fourth quarter of 2023. Woodside is operator with a 60% participating interest and PEMEX Exploración y Producción (PEMEX) holds the remaining 40%.

The forecast total capital expenditure is US$7.2 billion (US$4.8 billion Woodside share including capital carry of PEMEX of approximately US$460 million) with the development expected to deliver strong returns to Woodside shareholders as well as economic and social benefits to Mexico.

The investment is expected to deliver an internal rate of return (IRR) greater than 16% with a payback period of less than four years.2 The forecast IRR excluding the capital carry is greater than 19%.

The project will target the development of an estimated 479 MMboe of Best Estimate (2C) Contingent Resource (100%) of oil and gas (287 MMboe 2C Contingent Resources, Woodside net economic interest).3 The subsurface has been extensively appraised, with six well penetrations undertaken across the field, informing Woodside's understanding of this large, high-quality conventional resource.

The resource will be developed through a floating production unit (FPU) with an oil production capacity of 100,000 barrels per day. The FPU will be connected to a floating storage and offloading (FSO) vessel with a capacity of 950,000 barrels of oil.

Woodside's greenhouse gas emissions reduction targets remain unchanged by the decision to approve investment in Trion.4,5 The starting base for this target will not be adjusted as a result of the investment decision.

Woodside CEO Meg O'Neill said Trion is an attractive addition to Woodside's portfolio of high-quality producing assets in the Gulf of Mexico.

"Trion is a valuable resource with a mature development concept. Our strong balance sheet and disciplined approach enable us to invest in opportunities such as Trion, expanding our global portfolio and delivering long-term value."

The investment is aligned with Woodside's strategy, exceeds Woodside's capital allocation framework targets and will be a strong contributor to Woodside's cash flows, shareholder returns and the funding of future developments in oil, gas and new energy.

"This development leverages Woodside's proven expertise in deepwater project execution. The project's tendering process has resulted in approximately 70% of total forecast capital expenditure as lump sum or fixed rates, with key contracts to be progressively executed following joint venture approval.

"Trion has an expected carbon intensity of 11.8 kgCO2-e/boe average over the life of the field, which is lower than the global deepwater oil average, and will be subject to Woodside's corporate net equity Scope 1 and 2 emissions reduction targets.

"We have considered a range of oil demand forecasts and believe Trion can help satisfy the world's energy requirements. Two-thirds of the Trion resource is expected to be produced within the first 10 years after start-up.

"We are developing Trion because we believe it will deliver value for Woodside shareholders and benefit for Mexico, including generation of jobs, taxation revenue and social benefit. We value the ongoing relationship with PEMEX and the support of the Mexican Government and regulators," she said.