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Santos announces record year

Mining & Resources

South Australian oil and gas giant Santos achieved record annual production, sales and revenue in 2019, according to its quarterly activities report released today.

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The state’s largest company today reported production of 75.5 million barrels of oil equivalent (mmboe) in 2019 – up 28 per cent from 58.9 mmboe the previous year.

The report says Santos sold 94.5 mmboe over the year, up from 78.3 mmboe in 2018 – and it achieved sales revenue of $4.03 billion, up from $3.66 billion in 2018.

Santos Managing Director and CEO Kevin Gallagher said in a statement to the Australian Securities Exchange that the company had also delivered lower unit production costs and strong cash flow in 2019.

“The year was highlighted by highest ever free cash flow of more than $1.1 billion, record onshort drilling performance, lower unit production costs and significant progress on our diversified portfolio of growth projects,” he said.

“The acquisition of ConocoPhillips’ natural gas assets in northern Australia and Timor-Leste, announced in October, is fully aligned with our growth strategy to build on existing infrastructure positions and delivers operatorship and control of strategic LNG infrastructure at Darwin.”

Gallagher said Santos was in a position to benefit strongly from growing global demand for natural gas, which he said was “forecast to supply a quarter of the world’s total energy demand by 2040”.

“Santos, with its portfolio of long-life natural gas assets, is well positioned to benefit as we seek to deliver 120 mmboe of production by 2025.”

The company announced the 2025 production target, which had been revised up from 100 mmboe, in December.

Gallagher added that Santos was “investing in projects to lower emissions and assessing the significant potential for carbon capture and storage in the Cooper Basin”.

Santos shares were up 4 cents for the day to $8.92 at lunch time.

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