Power Up is Stockhead’s fortnightly look at all the news and moves driving ASX energy stocks.

Woodside’s (ASX:WPL) $27bn acquisition of BHP’s (ASX:BHP) oil and gas business has received the stamp of approval from the former’s shareholders, setting the stage for the Australian LNG producer to become a top tier global energy company from 1 June.

It is not hard to see why given that high oil prices mean that BHP Petroleum’s high performing and unencumbered Gulf of Mexico assets are expected to contribute significantly to Woodside’s bottom line.

The greater mass will also make it easier for Woodside to develop large projects.

The decision is not universally popular though, with environmental groups questioning how a Woodside with even more oil and gas assets would address emissions as the world continued to progress towards a net zero scenario.

Meanwhile, with no oil and gas assets, and only its mining assets left to clean-up, BHP will skip merrily away with a bagful of Woodside shares that are almost certainly a lot easier to offload when needed than an array of expensive oil and gas projects.

The emissions question

But is Woodside’s emissions future truly that dire? After all, the company has committed to investing some $5bn to develop new energy products and lower carbon services by 2030.

Green groups have been quick to decry this as greenwashing, noting that investment is less than half the expected cost of the giant Scarborough development. Greenpeace has queried the disparity between Woodside’s Burrup Hub development and Australia’s emissions reduction commitments under the Paris Agreement.

These are good points, especially when compared with BP’s plan to dedicate 40% of its budget to parts of its business that would aid the energy transition by 2025.

To top it off, Woodside’s clean energy moves to date have not added any confidence, with its H2 Perth gas and renewable hydrogen plant slammed for not being a genuine move into renewable hydrogen.

Its focus on carbon capture and utilisation is also iffy given that even Chevron has admitted that its Gorgon CCS project is only working at half its planned capacity and still has some way to go before meeting its commitments.

Woodside a potent climate champion?

There are however, a couple of points in Woodside’s favour – though it remains to be seen if the major will take advantage of them.

Firstly, the same size that will benefit its oil and gas projects can also be turned around for serious renewable energy investments.

But major projects take time to develop so Woodside will have to take action sooner rather than later to really make an impact on Australia’s emissions.

Along the same vein, the company does have a strong track record in project development. Expertise that can quite easily translate to renewable energy projects.

With the votes freshly counted and the merger coming up soon, Woodside will need some time digesting its gains before we see any concrete action on the emissions front.