BRISBANE (Reuters) -Woodside Petroleum’s shareholders on Thursday voted for a merger with BHP Group’s petroleum arm to create a top 10 global independent oil and gas producer worth $40 billion, according to a vote count at the company’s annual meeting.
Of the total final votes, 98.66% were in favour of the deal.
The merger, agreed last August, advances top global miner BHP’s effort to move away from fossil fuels, as it looks to decarbonise, while doubling Woodside’s oil and gas production and beefing up its funding for growth.
“The merger is an opportunity for Woodside to increase its contribution to the world’s growing energy needs and build the scale, resilience and diversity to thrive through the energy transition,” Chief Executive Officer Meg O’Neill told shareholders.
BHP will be paid in Woodside shares, giving BHP investors a 48% stake in the merged group, which will have assets in Australia, the United States, Mexico, Senegal and Trinidad.
While backing the merger, shareholders were disappointed with Woodside’s climate plan, which does not set targets for reducing its customers’ emissions, called Scope 3 emissions.
Nearly 49% of the votes were against the climate plan, which Woodside put to an advisory vote for the first time.
Two proxy advisers recommended voting against the plan.
Woodside Chairman Richard Goyder ordered the microphone to be cut off after one proxy for a shareholder asked whether the company’s plans to invest in fossil fuels were “morally mad, economically mad or both”, to which the chairman replied, “Or neither”.
However, Goyder said the company clearly needs to engage more with shareholders to explain that its plans are in line with Paris Agreement goals.
O’Neill said Woodside’s strategy on Scope 3 is to come up with clean products, such as hydrogen, for its customers.
(Reporting by Sonali Paul; Editing by Christopher Cushing and Rashmi Aich)