Santos Limited · ASX:STO
Santos — Non-Deal Roadshow (June 2011)
28 slides from Santos's roadshow presentation, Jun 6, 2011
Slide 1: ASX cover note: Investor Presentation June 2011
Santos Ltd ABN 80 007 550 923 Ground Floor, Santos Centre 60 Flinders Street Adelaide South Australia 5000 GPO Box 2455 Adelaide South Australia 5001 Direct: + 61 8 8116 5000 Facsimile: + 61 8 8116 6723 TO: Company Announcements Office ASX Limited FROM: Company Secretary DATE: 6 June 2011 SUBJECT: I
Slide 2: US Investor Roadshow: Disclaimer & Important Notice
US Investor Roadshow June 2011 1 Disclaimer & Important Notice This presentation contains forward looking statements that are subject to risk factors associated with the oil and gas industry. It is believed that the expectations reflected in these statements are reasonable, but they may be affected
Slide 3: Santos overview and vision and strategy
Santos overview Regional footprint of operations One of Australia's leading upstream oil and gas companies and has been Beibuan Trough Kyrgyz Republic operating since 1954 Phu Khanh Basin Bangladesh Current production: Kutei Basin India Timor Sea & Timor Gap - ~600 mmscf/d of gas Nam Con Son Bas
Slide 4: Transforming to oil-linked pricing; safety performance
Transforming to oil-linked pricing 70% of 1.4bn boe 2P reserves Asset base is transformed exposed to oil prices through sanctioned projects Cooper to GLNG Production (mmboe) 80 Oil-linked Legacy domgas NSW 70 CSG 60 EA legacy 50 domgas contracts 40 Asia LNG domgas 30 WA legacy d domgas 20 contracts
Slide 5: Base production grows; underlying net profit up 46%
Base production grows to record levels Four projects in the base commence production in 2011 Project Santos Gross First Production (mmboe) interest production production 70 capacity Reindeer/ 45% 215 TJ/d1 4Q 2011 60 Devil Creek WA 50 Spar 45% 50 TJ/d2 2 June WA 2011 Chim Sáo 31.875% 25,000 bbl/d 2H
Slide 6: $8 billion of funding capacity
$8 billion of funding capacity Comprehensive funding plan A$billion As at 31 Dec 2010 executed including: 8 A$2 billion bilateral bank 7 1.5 facility 6 €1 billion hybrid with 100% 5 2.0 equity credit from S&P 4 A$500 million institutional 3 placement to complete equity funding required for 2 4
Slide 7: Strategy delivers material LNG growth
LNG is a key component of Santos’ growth strategy Strategy Bonaparte LNG Components 2 mtpa FLNG PNG LNG Santos 40% with carry to FID Sanctioned Dec 2009 6.6 mtpa two trains Deliver the First LNG due 2014 Darwin LNG Base Business Production since 2006 Santos 13.5% 3.6 mtpa single trai
Slide 8: Continue to see strong long-term LNG pricing
Continue to see strong long-term LNG pricing Asian Term Prices $18 Late 2006 Recent contracts $16 2008-10 point to strong underlying d l i demand d d Ex-ship LNG Price ($/MMBtu $14 Pricing reflects new Ex-Ship LNG Price ($/MMBtu) US$12/MMBtu $12 Oil Parity Mid 2006 supply-demand equilibrium $10
Slide 9: GLNG project; world-class GLNG contractors
GLNG Two-train 7.8 mtpa GLNG project under construction FID January 2011 All permits it for f access to t Curtis C ti Island and mainland sites at Gladstone delivered in accordance with project schedule Orders placed for long leads Construction work underway on Curtis Island and mainland sit
Slide 10: GLNG 2P reserves for two trains
GLNG 2P reserves for two trains 2P Reserves (PJ) 5,009 2P CSG reserves at 10,000 Actual Projected Dec-101 - NSAI estimated higher 2P 8,000 reserves of 5,377 PJ as at end Oct-101 6,000 In addition to CSG reserves, Santos to supply 750 PJ of 4,000 portfolio gas, primarily from the Cooper Basin 2,0
Slide 11: PNG LNG construction continues to ramp-up
PNG LNG PNG LNG construction continues to ramp-up Project PNG LNG Location Papua New Guinea Santos interest 13 5% 13.5% Partners ExxonMobil 33.2%, Oil Search 29%, State of PNG 16.8%, Nippon Oil 4.7%, MRDC 2.8% Project scope Upstream gas & condensate fields Gas transmission pipeline 2-train LNG
Slide 12: Darwin LNG and Bonaparte LNG
Bayu-Undan / Darwin LNG Darwin LNG: continuing strong production Project Bayu-Undan/Darwin LNG Location Timor Gap, Australia/Timor-Leste Santos interest 11.5% Partners ConocoPhillips, ENI, INPEX, TEPCO, Tokyo Gas Project scope Offshore gas & condensate fields Gas transmission pipeline Single t
Slide 13: Burnside discovery
Burnside discovery Exploration success… Montara Legend Crux Santos acreage Argus Territory of Asmore & Oil field WA 274 P WA-274-P Cartier Islands Gas field WA-410-P Ichthys WA-274-P Poseidon WA-274-P North Concerto Cornea Echuca Prelude Shoals Torosa Ichthys Caswell Burnside WA-411-P Brecknock Call
Slide 14: Australia's leading domestic gas producer
Australia’s leading domestic gas producer Santos is Australia's Leading Domestic Gas Producer % of Domestic Gas Production 15% 15% 11% 9% 8% 7% 4% 4% 4% 3% Woodside ExxonMobil ConocoPhillips Santos Apache Shell Origin Energy BG Group BP BHP Billiton 25 Source: Energy Quest May 2011 Domestic channel
Slide 15: Eastern Australia
Eastern Australia Santos’ gas supply infrastructure in eastern Australia provides Queensland substantial flexibility in gas supply Santos has assets in every Surat/Bowen Fairview, Roma, producing basin Ballera Scotia, Arcadia Moomba Santos’ portfolio gas provides significant optionality in gas S
Slide 16: Gunnedah Basin – next major coal seam gas play
Gunnedah Basin – Next major play in coal seam gas Basin master position with >50 tcf prospective potential Santos and Eastern Star Gas (ESG) Wilga Park Power Station operated permits cover 60,000 km2 PPL 3 Narrabri New PEL PAL 2 Santos holds 35% interest in ESG 434 South Wales PEL 238 operated p
Slide 17: Hub-led strategy; Reindeer/Devil Creek
Hub-led strategy Santos supplies gas via one of two existing hubs and one new hub under construction… Reindeer Focused NFE John Brookes Spar / Halyard Varanus Is. East Spar Devil Creek Legend …with focused drilling in shallow water Santos acreage Gas pipeline close to existing hubs targeting low Oil
Slide 18: Spar, WA; Zola gas discovery
Spar, WA Spar – Development of Halyard (WA-13-L) and Spar (WA-4-R) Project Spar Location Carnarvon Basin, offshore WA S t interest Santos i t t 45% Partner Apache 55%, operator Project scope Tie-back of Halyard and Spar wells to Varanus Island via existing East Spar pipeline Modifications to Joh
Slide 19: Indonesia: Madura Offshore PSC
Asia Pacific 35 Indonesia: Madura Offshore PSC Maleo performing beyond expectation; incremental growth from Peluang Maleo - Production since 2006 Peluang-1 - Gross gas production Maleo Madura Island ~115 TJ/d Surabaya - Long term sales gas contract to PT Perusahaan Gas Negara Madura Grati Peluan
Slide 20: Indonesia: Sampang PSC; Wortel
Indonesia: Sampang PSC Oyong Phase 2 delivered; incremental growth from Wortel Oyong Phase 1 (oil) - Production performance above Java Sea expectation at ~3500 bbl/day (gross) Wortel Oyong Oyong Phase 2 (oil and gas) Madura Island - Gas production start-up on time Surabaya (Q309) and plateau of
Slide 21: Chim Sáo, Vietnam; Bay of Bengal
Chim Sáo, Vietnam Chim Sao – New oil production for Santos Project Chim Sáo Location Block 12W, offshore Vietnam S Santos i interest 31 875% 31.875% Partners Premier 53.125%, operator PetroVietnam 15% Project scope Unmanned, minimum facility wellhead platform Liquids processing and export via FP
Slide 22: Reference Slides: 2011 Guidance
Reference Slides 41 2011 Guidance Item 2010 2011 Actual Guidance Production 49.9 mmboe 47 – 50 mmboe Production costs $537m $550 – $590m DD&A expense $11.94/boe $12 – $13/boe Royalty related taxation expense $51m $80 – $100m (after tax)1 Capital expenditure (including $1 9 billion $1.9 $3 billion ex
Slide 23: 2011 forward exploration schedule; reported & underlying profits
2011 Forward exploration schedule Santos Well Name Basin / Area Target Interest Timing % Zola-1 Carnarvon Gas 24.8 Gas discovery PEL 1 corehole Gunnedah CSG 25.0 CSG corehole Finucane South-1 Carnarvon Oil 33.4 Oil discovery Beam-1 Carnarvon Gas 45.0 Q3 Hoss-1 Carnarvon Oil 31.3 Q3 Tuy Hoa-1 Phu Kha
Slide 24: Production impacted by flooding; sales volumes and revenue
Production impacted by flooding Production in line with Production guidance mmboe 60 Total wet weather and 54.4 (2.9) (2.1) 2.0 (1.5) 49.9 flood impact on Cooper 50 Basin was 2.9 mmboe 40 Stronger gas 30 production in WA and Indonesia 20 Mereenie ((NT)) gas g 10 sales contract expired 0 end-
Slide 25: Production cost and cost of sales; Business Unit EBITDAX
Production cost and cost of sales Production costs Total cost of sales $m $m 600 1600 $532 $532m $537m $24 70 $24.70 $23.67 per boe 500 per boe $9.78 $10.77 1400 Gas Purchases / boe / boe 400 300 1200 Cost of produced 200 hydrocarbons1 1000 100 0 800 2009 2010 2009 2010 1 Includes production costs,
Slide 26: DD&A declines; reserves growth and resource conversion
DD&A declines by $17 million Lower depletion primarily Volume Rate due to lower production $m volumes 612 (36) 19 595 700 Partially offset by impact of higher rates 600 2011 guidance $12/boe 500 400 300 200 100 0 2009 2010 $11.25/boe $11.94/boe 49 Reserves growth and resource conversion Revisi
Slide 27: Significant items (after tax); 2011 sensitivities
Significant items (after tax) $m 2010 2009 Underlying y g profit p 376 257 Significant items 124 177 Net profit after tax 500 434 Significant items included: Net gains on asset sales 214 180 Impairment of non-current assets (101) (17) Impairment of receivables (22) - Provision of contract losses: ri
Slide 28: Contact Information
Contact Information Head office Andrew Nairn Adelaide Group Executive Investor Relations Ground Floor, Santos Centre Level 10, Santos Centre 60 Flinders Street Direct: + 61 8 8116 5314 Adelaide, South Australia 5000 Facsimile: +61 8 8116 5131 GPO Box 2455 Email: andrew.nairn@santos.com Adelaide, Sou