Oil and gas producer Woodside Energy posted a smaller-than-expected fall in annual profit on Tuesday, as higher production softened the blow from weaker realised prices, sending shares up to a nearly 18-month high.

Shares of Woodside rose as much as 2.1% to A$27.66, their strongest level since early September 2024, as of 2353 GMT.

Robust annual output from its Sangomar project in Senegal, its first full-year of contribution to Woodside, helped offset weaker realised crude prices and higher cost of sales.

Woodside, Australia's top oil and gas producer, reported an underlying net profit after tax of $2.65-billion for the year ended December 31, above Visible Alpha consensus of $2.54-billion, but fell from the $2.88 -illion profit a year earlier.

The company delivered a 3% hike in annual production, but profitability came under pressure as the cost of sales jumped 13% and average realised prices fell to $60.2 per barrel of oil equivalent (boe) from $63.4 per boe a year earlier.

LNG's long-term demand is expected to strengthen as emerging Asian economies expand, the company said.

Woodside said its Scarborough energy project is 94% complete, as of end-December, and remains on track for first LNG in the fourth quarter of 2026.

Meanwhile, Woodside said it is still in discussions on a potential sale of an additional 20% stake in the holding company for its Louisiana LNG project, a key pillar to its North American expansion strategy.

The firm currently owns 90% of the holding company, while US-based Williams holds the rest.

"Once operational, Scarborough gas and output from Louisiana LNG will help meet long-term energy demand," the company said.

The Australian firm, which had announced the surprise exit of CEO Meg O'Neill in mid-December, declared a final dividend of 59 cents per share, compared with 53 cents last year.

O'Neill left Woodside to take the top job at British oil major BP BP.L, and the company has yet to appoint a permanent successor. Acting CEO Liz Westcott is seen as one of three leading internal candidates for the role.

"The next key catalysts expected are further equity sell-downs of Louisiana LNG expected over the coming six months and a new CEO appointment expected shortly," UBS wrote.