The oil and gas industry globally experienced volatile and challenging conditions throughout 2015, as the decline in oil prices that began in 2014 continued throughout the year.
Low oil prices impacted profits and resulted in impairment charges, but low operating cash costs mean that we continue to generate significant cash, and the balance sheet remains strong.
We reported a profit of US$26 million for 2015. This adjusted to US$1.126 billion, prior to one-off non-cash items deducted. This remains down on 2014's profit of US$2.414 billion.
Against this backdrop, we remained focused on our commitment to sustainability.
Health, safety, environmental, social and economic considerations are integral to our decision making and key to us delivering successful business outcomes. The productivity initiatives embedded across our business also helped us to achieve economic resilience and finish the year well-positioned for 2016.
We continued to grow our business at home and abroad, mindful that wherever we work we are committed to living our values of integrity, respect, working sustainably, discipline, excellence and working together.
For us, working sustainably is essential to realising our vision to be a global leader in upstream oil and gas, and we made good progress in key areas in 2015.
We remain on track to achieve global top-quartile health and safety performance by 2017.
During 2015, we achieved an 8% reduction in flared gas intensity through a sustained focus on eliminating flaring where possible and continually improving reliability at our facilities. This is key in our response to global efforts to reduce greenhouse gas emissions and reflects our commitment to developing resources responsibly.
We maintained our commitment to early childhood development. The Woodside Development Fund is supporting delivery of parenting and early childhood services in Myanmar, adding to the support being provided in communities across Australia.
We are committed to high levels of governance and transparency, and I am proud to report that Woodside was granted membership to the Voluntary Principles on Security and Human Rights Association. This a clear reflection of our commitment to embedding best practice and respecting human rights of the communities in which we are active.
Our work to increase Indigenous representation in our workforce continues. While we didn't meet our 2015 employment target, we have made progress in reducing turnover rates and will continue to work hard to raise Indigenous employment levels.
Finally, I would like to thank our communities for their ongoing support, our partners for their willingness to work with us and our employees for their ongoing commitment towards sustainable development.
Managing Director and Chief Executive Officer
18 March 2016
Message from our Sustainability Committee
In 2015, the Sustainability Committee continued to fulfil its role of assisting the Board to meet its oversight responsibilities in relation to the company's sustainability policies and practices.
The committee met six times during the year and was briefed on topics covering health and safety, process safety, environment, heritage, land access, security and emergency management and community relations.
Throughout 2015, it was pleasing to note a steady improvement towards global top-quartile performance in health and safety. We also continued to support personal health outcomes and build on the successful launch of the Fit for Life program. The program supports positive behaviour decisions in three areas: healthy bodies, healthy living and healthy minds.
The committee was particularly focused on the company's process safety management improvement program, undertaking 'deep dives' into aspects of process safety performance at each meeting. This program delivered a number of targeted and sustainable enhancements to our management system and activities, including a revised process safety competency framework.
Emissions reduction continued to be a key focus area for the business. Teams in Karratha and Perth should be congratulated for the flaring reductions achieved at the Pluto LNG Plant.
The committee was briefed on Woodside's 2016–2020 social investment strategy, which will focus on creating and building long-term community capacity and capability. Particularly pleasing is that the new priority areas have been developed with a focus on supporting sustainable outcomes in the communities in which we are active.
Woodside's 2016 Reconciliation Action Plan was reviewed and endorsed by the committee.
The committee validated the material issues identified by stakeholders for inclusion in this report and discussed stakeholder expectations around key issues including climate change.
We will continue to work with management in 2016 to ensure that Woodside delivers sustainable growth for all of its stakeholders.
Sustainability Committee Chairman
18 March 2016