Woodside (ASX:WPL) share price struggles following rig dumping proposal

Could Woodside set a precedent for the future with its plan to create an artificial reef?

| More on:
artificial reef

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Woodside Petroleum Limited (ASX: WPL) share price has finished the week lower.

On Friday the $21.51 billion oil and gas giant slipped 1.06% to $22.34 a share. This is despite oil prices climbing higher overnight.

There are no official announcements from the company today. However, reports from ABC News reveal Woodside plans to lay waste to an oil facility. The interesting aspect is the intention to create an "artificial reef" by doing so.

Is it so 'rig-diculous' of an idea?

The proposal involves Woodside's Nganhurra oil facility which was decommissioned from service in 2018. While the company initially planned to tow the production and storage vessel back to shore shortly after ceasing operations, a design flaw stopped this occurring.

Now the company's 'ingenious' plan is to sink the 83-metre-long riser to the bottom of the ocean. This consists of 325 tonnes of iron ore slurry. In the process, the company hopes to create an artificial reef. However, this route does not come without its issues either.

The National Offshore Petroleum Safety and Environmental Management Authority (NOPESEMA) is investigating Woodside for potentially breaching the law by allowing the rig to degrade, leading to the inability of disposing of it on land.

Additionally, the facility proposed for dumping contains an estimated 65 cubic metres of polyurethane foam. This was approved by NOPESEMA due to the safety risks posed by attempting to remove it.

However, there now seems to be confusion over whether the oil and gas company will remove the foam or not. This could have weighed on the Woodside share price on Friday.

The reason why this plan is drawing eyeballs is the potential cost savings if Woodside's approach is approved. A study from the National Energy Resources Australia (NERA) points to a $50 billion exercise in decommissioning and removing facilities in the coming decades.

In the study, NERA concluded that half of those costs could be eliminated by leaving most of the materials in the ocean.

Woodside share price snapshot

The Woodside share price has experienced an underwhelming past 12 months. During the period, the company's share price has climbed a paltry 6%, compared to the S&P/ASX 200 Index (ASX: XJO) which delivered a 22.8% return.

Should you invest $1,000 in Sigma Healthcare right now?

Before you buy Sigma Healthcare shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Sigma Healthcare wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Energy Shares

Coal miner holding a giant coal rock in his hand making a circle with his hand, symbolising a rising share price.
Energy Shares

2 ASX 200 coal stocks to buy now despite tariff impact: Expert

Investors are nervous about the impact of US tariffs on global coal consumption.

Read more »

Man raising both his arms in the air with a piggy bank on his lap, symbolising a record high.
Share Market News

US-China tariff deal sparks strong week for ASX 200

Energy shares ripped 5.77% higher while the ASX 200 lifted 1.37% over the five days.

Read more »

Coal miner standing in a coal mine.
Dividend Investing

Down 22% this year, does this ASX dividend share still offer investors a 10% yield?

There's a difference in trailing and forward dividend yields.

Read more »

Worker inspecting oil and gas pipeline.
Energy Shares

What's moving the Woodside share price on Friday?

Here's the latest news from the ASX 200 oil and gas giant.

Read more »

Miner looking at a tablet.
Share Gainers

Up 93% since April should I still buy Boss Energy shares now?

Boss Energy shares, the most shorted on the ASX, have almost doubled in value in one month. Now what?

Read more »

A man in his 30s holds his laptop and operates it with his other hand as he has a look of pleasant surprise on his face as though he is learning something new or finding hidden value in something on the screen.
Share Gainers

Boss Energy shares have rocketed 90% in a month. Here's why

The massive rally in Boss Energy shares will be painful to the host of short sellers betting against the uranium…

Read more »

Oil worker using a smartphone in front of an oil rig.
Energy Shares

ASX 200 energy shares plunge on shock OPEC move

ASX 200 energy shares like Woodside and Santos are tumbling on Monday. Let’s find out why.

Read more »

Female oil worker in front of a pumpjack.
Energy Shares

Should you buy Woodside shares in May?

Is this energy giant a good investment right now?

Read more »