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Woodside’s Deepwater MOU With PEMEX Might Change The Case For Investing In Woodside Energy Group (ASX:WDS)

Simply Wall St · 1d ago
  • Woodside Energy Group recently signed a non-binding Memorandum of Understanding with Petróleos Mexicanos in Mexico City, enabling both companies to assess future deepwater hydrocarbon exploration and extraction opportunities in the Gulf of Mexico and formalizing the exchange of technical knowledge and best practices.
  • This agreement builds on their collaboration at the Trion Oil Project, Mexico’s first ultra-deepwater development, where Woodside, as operator with a 60% interest, and PEMEX are progressing a US$7.20 billion investment that is expected to deliver very large fiscal contributions and support Mexico’s energy security over the project’s life.
  • We’ll now examine how this deepwater-focused MOU with PEMEX, layered onto the Trion partnership, may influence Woodside’s existing investment narrative.

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Woodside Energy Group Investment Narrative Recap

To own Woodside today, you need to believe its large LNG and oil portfolio can keep generating solid cash flows while mega projects like Scarborough, Louisiana LNG, and Trion are delivered on time and on budget. The PEMEX MOU reinforces Woodside’s deepwater ambitions but does not materially change the near term focus, which remains on project execution and cost control, with the biggest risk being schedule slippage or overruns on these capital intensive developments.

Against that backdrop, the August 2026 half year result is especially relevant. Woodside reported sales of US$7,446 million and net income of US$1,672 million for the six months to June 30, 2026, up from the prior year, and declared a US$0.57 per share dividend. For investors watching execution risk at Trion and other projects, these numbers offer a current snapshot of earnings power and balance sheet support as the company commits to large, long dated investments.

Yet for all this progress, investors should also be aware that cost overruns or regulatory shifts in key LNG and deepwater jurisdictions could...

Read the full narrative on Woodside Energy Group (it's free!)

Woodside Energy Group’s narrative projects $14.6 billion revenue and $2.8 billion earnings by 2029.

Uncover how Woodside Energy Group's forecasts yield a A$33.10 fair value, in line with its current price.

Exploring Other Perspectives

ASX:WDS 1-Year Stock Price Chart
ASX:WDS 1-Year Stock Price Chart

By contrast, the most bearish analysts were assuming only about 1.4 percent annual revenue growth to roughly US$13.5 billion and earnings near US$2.2 billion, so you may want to compare that more cautious view of decarbonization and project risk with how the PEMEX deepwater MOU could either reinforce or challenge those assumptions.

Explore 7 other fair value estimates on Woodside Energy Group - why the stock might be worth over 4x more than the current price!

Form Your Own Verdict

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.