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Leadership
In volatile times, the traditional strengths of the CFO come to the fore
In an era of geopolitical shocks, rapid technological change, and large-scale corporate transformation, Woodside Energy’s CFO Graham Tiver argues that the core disciplines of finance leadership are more important than ever.
For many finance leaders, the past decade has broadened the scope of the role. Yet for Graham Tiver, CFO of major energy player Woodside Energy, it’s important to recognize that the fundamentals remain unchanged and are more central than ever.
In a macroeconomic environment shaped by escalating geopolitical volatility and accelerating technology disruption, Tiver argues that the traditional strengths of the finance function are crucial when it comes to driving transformation and supporting the company’s growth agenda.
The evolution of Woodside illustrates the point. The Australia-founded energy company has been in the throes of transformation from a predominantly Asia-Pacific business into a global energy supplier. Woodside will bring several major projects in Australia, the United States, and Mexico online in the coming years, reshaping both the company’s operations and its strategy.
“We have several critical activities taking place, on which we’re determined to deliver,” he says. These include the Scarborough liquefied natural gas (LNG) project in Western Australia and the Beaumont New Ammonia facility in Texas, both major investments intended to support long-term value. “If we jump forward 12 months, and we hope to have Scarborough online, and we have Beaumont online, we’re a very different organization,” Tiver says.
Behind that strategic ambition lies a central responsibility to ensure the company has the financial strength to execute. “My role as CFO is very much about ensuring we have the liquidity and the balance sheet to navigate this phase,” Tiver says. In a sector highly exposed to commodity cycles and geopolitical risk, such as the recent developments that have unfolded in the Middle East, financial resilience is paramount.
Fundamentals first: The enduring mandate of the CFO
For Tiver, the current environment reinforces a broader lesson about finance leadership: while the CFO’s responsibilities may have expanded, the core mandate remains consistent. During periods of volatility, which can reshape energy markets overnight, this focus on financial fundamentals becomes even more important.
Tiver also points to the significance of traditional oversight of the financial implications of decisions across the business. For him, finance leaders’ enterprise-wide vision allows them to link decisions across the company to a central question: How is value created?
For Woodside, value creation extends beyond simply increasing shareholder dividends. The company operates large projects in jurisdictions where energy investment has implications for communities, governments, and national economies.
Value discipline in the energy transition
These principles also shape how Woodside approaches one of the challenges defining the sector: the shift toward lower-carbon energy systems.
In common with many other energy companies, Woodside is simultaneously pursuing several pathways. The business continues to invest in oil and gas, while also progressing new energy opportunities, including carbon capture and storage and lower-carbon ammonia.
All these investments are measured against a capital-allocation framework that divides the portfolio into three broad categories: oil, gas and new energy products, and lower-carbon services. Each has different return expectations. Oil projects, for example, are expected to deliver faster payback and higher returns.
“In the context of oil, we want a payback [period] of less than five years and we want a 15% IRR [internal rate of return],” Tiver says.
Gas projects are evaluated based on a slightly longer timeframe. Because Woodside expects natural gas to play an important role in the energy mix for years to come, the company is prepared to accept lower returns and longer payback periods.
“We see gas as a critical part of the energy transition,” Tiver explains. “The nature of gas investment is that we will accept a 12% IRR and a payback of seven years.”
New energy investments reflect the realities of emerging markets, where commercial models are still evolving. “New energy is an emerging market. It’s tough, to be frank,” he says. “But we look at [a payback period] of 10 years, and an IRR of around 10%.”
The framework reflects a pragmatic view of the energy transition. While decarbonization remains a priority, energy security is an increasingly prominent concern.
“When we talk to our customers, we see more and more focus on energy stability and energy security,” Tiver says. “Lowering emissions is still very important, but it’s happening alongside some of the geopolitical volatility we’re seeing.”
“Gas is critical to balancing and stabilizing renewables in the energy mix,” he says. “Studies have shown that when used to generate electricity, gas produces roughly half the lifecycle emissions of coal, and it’s something you can turn on and off quickly to help balance the network.”
While addressing these strategic challenges, Woodside is also exploring the possibilities of using new technologies to improve the efficiency and reliability of its expanding operations.
Extracting operational value from AI
While addressing these strategic challenges, Woodside is also exploring the possibilities of using new technologies to improve the efficiency and reliability of its expanding operations. Unsurprisingly, AI has emerged as one of the most promising areas of investment, and the company has moved to establish AI centers across several of its global offices.
Much of the early impact is being seen in operational settings, particularly at the company’s large-scale industrial facilities. At Woodside’s Pluto LNG facility in Western Australia, for example, AI tools are helping engineers analyze a decade’s worth of historical startup data. Woodside has used that information to create a digital twin of the Pluto facility, allowing the company to simulate optimal startup procedures following maintenance activities.
Elsewhere, Woodside is using the technology to analyze production data across its operations. “How do we give an operator 10 years’ worth of experience in one month? Through AI,” Tiver says. The aim is to help operators diagnose potential issues and maintain efficient, reliable production.
Tiver emphasizes that, in a commodity-based business, the economic benefits of these technologies are particularly clear. Because Woodside sells into global commodity markets where prices are determined externally, efficiency gains translate directly into stronger margins. “We’re not like a service industry, where we use the technology to become more competitive and lower our prices,” Tiver explains. “We’re using it to lower our costs or increase production, which creates value for our shareholders.”
As Woodside continues its transition from a domestic-focused energy company to a global supplier, those principles will shape the next phase of its growth.
Looking ahead
For Tiver, these developments reinforce a central lesson about finance leadership in complex industries. In a world marked by geopolitical uncertainty, energy transition, and rapid technological change, the CFO role still comes back to fundamentals: financial resilience, disciplined capital allocation, and a clear focus on value.
As Woodside continues its transition from a domestic-focused energy company to a global supplier, those principles will shape the next phase of its growth.
Expert
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