Woodside Petroleum chairman Michael Chaney has told shareholders it was a difficult decision to axe the Browse LNG development near Broome but in the best interests of shareholders.
Addressing several hundred shareholders at Woodside's annual meeting in Perth this morning, Mr Chaney made clear that development of the Browse gas fields remained firmly on the agenda, despite the axing of the James Price Point option two weeks ago.
"With the other Browse joint venture participants, we now immediately turn our attention to alternative development options for the Browse fields so that this resource can deliver long-term benefits for our shareholders and the broader community," Mr Chaney said.
Chief executive Peter Coleman said Woodside would now propose a work program with its joint venture partners for the remaining 20 months of the retention leases.
“I am confident that we can begin basis design work on new concepts in the near future,” Mr Coleman said.
A group of environmentalists set up a protest-like display outside the meeting, at the Perth Convention Exhibition Centre, although it was themed a "thank you" to Woodside for not proceeding with James Price Point.
Mr Chaney said the environmental movement against the gas plant had had “zero” influence on the board's decision.
He said there were “some dollar costs” involved in dealing with the protest as part of $1.5 billion spent on the project.
Mr Chaney also spent time discussing the board's decision, announced yesterday, to declare a special dividend that will return about $500 million to shareholders late next month.
The special dividend was part of a board decision to increase the annual payout ratio from about 50 per cent to 80 per cent for several years.
Yesterday's dividend news sent Woodside shares up 10 per cent. Mr Chaney today said the higher payout would not affect Woodside's financial flexibility "so that we can continue to pursue growth opportunities where we believe they will create value for shareholders".
Shareholders overwhelmingly approved the company's 2012 remuneration report, which included Mr Coleman's total annual pay of $7.3 million, including almost $5 million in bonuses.
Woodside shares were up 33 cents to $38.29 at 11.45am.