SYDNEY - Woodside Energy said on Tuesday it will scale back exploration efforts and prioritise its $39-billion project pipeline to strengthen its balance sheet, after depreciation and decommissioning costs led to a slump in first-half profit.

Woodside, Australia's top gas producer, posted an underlying net profit of $1.25-billion for the six-month period ended June 30, down 24% from $1.63-billion last year.

CEO Meg O'Neill said the company will take "a disciplined approach to future growth and reduced spend on new energy and exploration as we prioritise delivering sanctioned projects."

In an interview with Reuters, she said Woodside's focus had shifted from pursuing growth projects to "absolutely" concentrating on delivery.

Woodside's four major projects, worth a combined $39-billion, include the Scarborough gas field in Western Australia, the Trion deepwater oil field in Mexico, and the Louisiana liquefied natural gas and Beaumont New Ammonia projects in North America.

"For Woodside now, it's all about project execution," said James Hood, senior energy analyst at Regal Funds.

"The risk for them is they're going through a heavy capex period when the market's expected to be in material oversupply of crude by the end of the calendar year," he said, adding this will ensure Woodside delivers an attractive dividend.

The Perth-based company declared an interim dividend of 53 cents apiece, at the higher end of its payout ratio target range of 50% to 80%.

The company is seeking a further 20% to 30% selldown of its stake in the Louisiana LNG project, and said that it is seeing "strong interest from high-quality potential partners".

MST Marquee's Saul Kavonic said Woodside is likely advancing talks with major Northeast Asian buyers, including Japan and Korea, to secure offtake and equity deals in Louisiana. This is aimed at rebalancing trade deficits and appeasing US President Donald Trump.

O'Neill said demand from Asia will boost global LNG demand, noting that while Europe has been an important market, significant growth is expected in the 2030s from Asian importers, driven by energy needs for data centres, AI, and chip manufacturing.

Shares of Woodside closed 2.79% lower at A$26.14.

Woodside's operating revenue rose 10% to $6.59-billion. Still, depreciation and amortisation costs tied to its Sangomar offshore oil and gas field in Senegal totalled $773-million, while a $445-million decommissioning expense weighed on the balance sheet, pushing net debt above expectations to $8.65-billion.