Key Santos projects near completion
Santos has recorded a slight decrease in sales revenue as its $327 million South Australian carbon capture project nears completion.
In its second-quarter results, Adelaide-based Santos reported $1.9 billion of revenue as it prepares for the completion of several large projects.
Santos said execution and construction of its $327 million Moomba Carbon Capture and Storage project (CCS) in the Cooper Basin has reached 92 per cent completion, with the initial study on pipelines for the project’s phase two facility complete.
Mechanical completion of the project was achieved on July 6 this year, with the project now in its final commissioning phase.
Studies for potential domestic and international customers for CO2 sources are ongoing to expand the project’s operations to capture and store third-party CO2 for phase two.
“Our Moomba CCS Project is now mechanically complete and is on track to ramp-up injection of Cooper Basin Gas Plant CO2 throughout the second half of 2024,” Santos managing director and CEO Kevin Gallagher said.
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“We can now see line of sight to our major projects progressively coming online, putting us in a strong position to deliver sustainable, competitive shareholder returns over the long term.”
Santos – the top company in South Australia per the 2023 South Australian Business Index – reported the Barossa project in the Timor Sea which was the subject of a Federal Court case remained on target, with production expected to commence in the third quarter of 2025.
“Our major projects continue to deliver to plan. I am very pleased that both the barossa pipelaying activities and the installation of the modules onto the FPSO in Singapore are now complete,” Gallagher said.
Drilling and completion of both wells in Angore Papua New Guinea occurred during the quarter, and Alaska’s Pikka Project is 56.2 per cent complete.
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“The Pikka project has had a strong first winter season with the team delivering significant progress on the North Slope, with some pleasing results,” Gallagher said.
The company’s quarterly revenue showed a nine per cent decrease from the same time last year. It blamed the decrease on lower LNG and crude oil volumes, which it said was offset by increased realised prices for domestic gas, crude oil, condensate and LPG.
Second quarter sales were consistent with the first quarter, with production of domestic sales gas and ethane increasing as a result of assets restarting after weather outages and planned maintenance.
“First half cash flow of almost US$1.1 billion positions us well to fund shareholder returns, backfill and sustain our existing business, and grow our Santos Energy Solutions Business,” Gallagher said.
Santos reported the Cooper Basin saw a slight increase in production from the previous quarter, but a $14.8 million decrease in sales revenue.
The second quarter saw $221.5 million of sales revenue from the basin, compared to $236.3 million the previous quarter, and $248.2 million in Q2 2023.
This equated to a total decrease of $17.8 million from the same time last year for revenue from the Cooper Basin.
The company said the production increase was driven by recovery of extreme weather events.
