Santos Limited · ASX:STO

Santos — Bank of America Merrill Lynch Australian Investment Conference 2009

53 slides from Santos's conference presentation, Sep 11, 2009

  1. Slide 1: Merrill Lynch Investment Conference Presentation

    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 5623 For personal use only To: Company Announcements Office ASX Ltd From: Company Secretary Date: 11 Sep

  2. Slide 2: Disclaimer & Important Notice

    For personal use only Investor Presentation September 2009 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 reasonabl

  3. Slide 3: Disclaimer & Important Notice

    For personal use only Investor Presentation September 2009 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 reasonabl

  4. Slide 4: Securing our Energy Future

    Securing our Energy Future For personal use only Natural Gas will play a vital role in meeting the energy requirements for Australia and the Asia Pacific region…  Natural gas can meet new base load power generation requirements in Eastern Australia: - Lowering the carbon intensity of power generati

  5. Slide 5: Natural Gas – Australia's strategic advantage

    Natural Gas – Australia’s strategic advantage For personal use only On 2008 consumption levels, eastern Australia has over 400 years of possible CSG resources alone …  Australian domestic gas CSG demand: > 1.1 Tcf pa Resource  Eastern Australian gas 200+ Tcf Potential demand: 0.62 Tcf pa 250+ Tcf

  6. Slide 6: The Santos Strategy

    The Santos Strategy For personal use only Using quality assets, Santos will safely deliver: Base business  Eastern Australia: Margin growth and resource conversion  Indonesia: Steady business with incremental growth  WA & NT: Exploit asset position LNG growth  GLNG: The leading CSG to LNG projec

  7. Slide 7: Profits impacted by lower oil prices

    Profits impacted by lower oil prices For personal use only 2009 Half Year Result Change on 2008 Oil Price A$73.28 per bbl (39)% Production 26.6 mmboe (4)% Sales Revenue $1,024 million (26)% EBITDAX $647 million (37)% Net Profit After Tax $102 million (66)% Operating Cash Flow $499 million (20)% Inte

  8. Slide 8: Santos "Beyond the 2P"

    Santos “Beyond the 2P” For personal use only Near term oil development Significant oil prospects in Chim Sao/Dua in Vietnam PNG LNG – Expansion Multiple TCF gas prospects opportunities in Bay of Bengal PNG LNG – significant project underpinned by Near-term oil and gas development world class gas res

  9. Slide 9: LNG is a key component of Santos' Growth Strategy

    LNG is a key component of Santos’ Growth Strategy For personal use only Strategy Bonaparte LNG Components  2mtpa FLNG PNG LNG  Santos 40% with carry to FID  On track for FID 4Q09  6.3mtpa two trains Deliver the  Santos 13.7% Darwin LNG Base Business  Commenced production in 2006  3.25mtpa sin

  10. Slide 10: GLNG: The Leading CSG to LNG Project

    GLNG: The Leading CSG to LNG Project For personal use only Momentum building towards FID in first half of 2010  Freehold land for liquefaction plant   Pre FEED work completed   PETRONAS selected as partner   LNG marketing well underway   Reserves build on track   Downstream FEED entry  

  11. Slide 11: GLNG: Downstream update

    GLNG: Downstream update For personal use only  Curtis Island site - EIS application for 10mtpa capacity (3 trains)  Downstream FEED - Bechtel appointed - 2-train FEED 40% complete - Curtis Island geotechnical site survey work complete  Pipeline FEED - GHD appointed - FEED 50% complete  Marketing

  12. Slide 12: PNG LNG, Darwin LNG and Bonaparte LNG

    For personal use only PNG LNG, Darwin LNG and Bonaparte LNG 19 PNG LNG on Track for 4Q 2009 FID  Pre FEED work on two train  6.3mtpa plant  Marketing Representative Agreement   Coordinated Development and Operating Agreement   Gas Agreement   Front End Engineering Design Entry Decision  

  13. Slide 13: Darwin LNG & Timor/Bonaparte/Browse

    Darwin LNG & Timor/Bonaparte/Browse For personal use only Multiple pathways to growth Darwin LNG Barossa  Santos 11.4% Evans Caldita Shoal Bayu-Undan  Base project continues to deliver with potential upside unfolding Darwin Indian Petrel Timor Bonaparte Ocean Tern  Santos has material contingent

  14. Slide 14: Burnside-1 – Great street address

    Burnside-1 – Great street address For personal use only 121˚ 122˚ 123˚ 124˚ 125˚ Legend Montara Santos acreage Oil field Crux -13˚ Gas field Argus Territory of Asmore WA-274-P & Cartier Islands WA-410-P WA-274-P Poseidon WA-274-P Concerto Cornea Echuca Mimia Shoals Torosa Ichthys -14˚ Caswell WA-411

  15. Slide 15: Santos' Leading CSG Acreage Position

    Santos’ Leading CSG Acreage Position For personal use only Greater Fairview Denison Gladstone Queensland Bowen  7,300 km2 (gross)  6,500 km2 (gross) Basin  115 TJ/d production  Exploration stage  Active development & appraisal programme Greater Roma Greater Scotia  7,700 km2 (gross)  2,500 km

  16. Slide 16: Production Delivery

    Production Delivery For personal use only Fairview production has reached 115TJ/d… Santos’ Operated CSG Sales Production Growth 160 Compressor Site 3 & Increased Water Fairview-Wallumbilla Capacity 140 Pipeline Tie-in & Operational Completed Compressor Site 2 120 Tipperary Compressor Expansion Acqui

  17. Slide 17: Managing Coal Seam Gas Water

    Managing Coal Seam Gas Water For personal use only Diversified water management strategy is being implemented  3 Pronged Strategy Irrigation - Irrigation - Injection Reverse Osmosis - Reverse Osmosis  Irrigation - 887,000 trees planted to date Cropping - Targeting 1.2m trees receiving 12.2 ML/day

  18. Slide 18: Demand for Eastern Australia gas

    Demand for Eastern Australia gas For personal use only Demand will more than double within 10 years… 1800 1600 Planned 1400 LNG Projects PJ/a 1200 1000 Carbon driven fuel switching 800 10 Year Historic Average 600 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: NEMMCO, Santos, company anno

  19. Slide 19: Enviable existing gas infrastructure

    Enviable existing gas infrastructure For personal use only Mt Isa Townsville  Supply and demand centres are effectively Gladstone Fairview networked Ballera Roma  Further investment is Wallumbilla Brisbane Moomba needed to enhance deliverability from some emerging supply areas Gunnedah Sydney Adel

  20. Slide 20: Leading position in Gunnedah Basin

    Leading position in Gunnedah Basin For personal use only Basin master position in quality basin with >50 tcf prospective potential  ESG operated areas (STO 48%)1 Wilga Park Power Station - 9 coreholes drilled of 20 well PPL 3 Narrabri New programme PEL 434 PAL 2 South Wales PEL 238 - Stepping out e

  21. Slide 21: Western Australia Domestic Gas

    Western Australia Domestic Gas For personal use only Santos portfolio is well placed to supply the WA domestic market  2008 gas and condensate Mutineer Fletcher production 5 mmboe Exeter  Established infrastructure Legendre  John Brookes ramp-up: 200PJ uncontracted 2P reserve Reindeer  Reindeer

  22. Slide 22: Reported & underlying profits

    Reported & underlying profits For personal use only Reported NPAT: 1st half Underlying NPAT: 1st half $m 320 304 283 (161) 280 240 200 160 (20) 120 102 102 prices 80 & fx other 40 0 2008 2009 2008 2009 39 EBITDAX  Lower prices and Operating Gas lower value product Prices Mix Costs Purchases Other m

  23. Slide 23: Segment EBITDAX Summary

    Segment EBITDAX Summary For personal use only Segment Half Year Half Year Change $m 2009 2008 % Eastern Australia 318 451 (29) WA&NT 285 474 (40) GLNG 8 38 (79) Asia Pacific 64 102 (37) Corporate and unallocated items (28) (33) 15 TOTAL EBITDAX 647 1,032 (37) Eastern Australia | Lower liquids prices

  24. Slide 24: Reference slides: Indonesia – Oyong & Wortel

    For personal use only Reference slides Indonesia – Oyong & Wortel  Oyong Phase 1 (oil) - First oil achieved in September Java Sea 2007 Oyong Maleo  Oyong Phase 2 (gas and oil) Sampang PSC - 60km pipeline to Grati Surabaya - Gas sales to PT Indonesia Power Madura Offshore PSC - Engineering and cons

  25. Slide 25: Vietnam

    Vietnam For personal use only  Prospective, lightly explored China Vietnam basins Burma Song Hong Laos Basin  Multiple, material play types 101-100/04 PSC  Oil and gas potential Thailand South China Sea  Rapidly growing markets Phu Khanh Cambodia Basin  Strong regulatory regime 123 PSC Nam Con

  26. Slide 26: Bay of Bengal – India / Bangladesh

    Bay of Bengal – India / Bangladesh For personal use only  Material Gas targets India  Enormous, underexplored, prospective Bangladesh tertiary delta near rapidly emerging India markets Sangu  India - PSC’s signed March 2007 Burma Bay of Bengal - Processing of 2D seismic survey completed - 4000 km

  27. Slide 27: 2009 Capital expenditure outlook

    2009 Capital expenditure outlook For personal use only (A$ million) 2009 2008 Capital expenditure 1,600 1,500 Acquisitions 476 5 Disposal proceeds1 (304) (2,052) 1 (pre tax, reported to date for 2009) 49 2009 Second Half Sensitivities Sensitivity Change NPAT Impact A$m US dollar oil price US$1/bbl 8

  28. Slide 28: Oil Price A$/bbl; Contact Information

    Oil Price A$/bbl For personal use only 1st half 2008 1st half 2009 180 160 140 Average: A$120.51 Current A$84.55 120 A$/bbl 100 80 Average: A$73.28 60 40 Jan 08 Jun 08 Jan 09 Jun 09 51 Contact Information Registered and head office Andrew Nairn Share Register Group Executive Investor Relations Adela

  29. Slide 29: Securing our Energy Future

    Securing our Energy Future For personal use only Natural Gas will play a vital role in meeting the energy requirements for Australia and the Asia Pacific region…  Natural gas can meet new base load power generation requirements in Eastern Australia: - Lowering the carbon intensity of power generati

  30. Slide 30: Natural Gas – Australia's strategic advantage

    Natural Gas – Australia’s strategic advantage For personal use only On 2008 consumption levels, eastern Australia has over 400 years of possible CSG resources alone …  Australian domestic gas CSG demand: > 1.1 Tcf pa Resource  Eastern Australian gas 200+ Tcf Potential demand: 0.62 Tcf pa 250+ Tcf

  31. Slide 31: The Santos Strategy

    The Santos Strategy For personal use only Using quality assets, Santos will safely deliver: Base business  Eastern Australia: Margin growth and resource conversion  Indonesia: Steady business with incremental growth  WA & NT: Exploit asset position LNG growth  GLNG: The leading CSG to LNG projec

  32. Slide 32: Profits impacted by lower oil prices

    Profits impacted by lower oil prices For personal use only 2009 Half Year Result Change on 2008 Oil Price A$73.28 per bbl (39)% Production 26.6 mmboe (4)% Sales Revenue $1,024 million (26)% EBITDAX $647 million (37)% Net Profit After Tax $102 million (66)% Operating Cash Flow $499 million (20)% Inte

  33. Slide 33: Santos "Beyond the 2P"

    Santos “Beyond the 2P” For personal use only Near term oil development Significant oil prospects in Chim Sao/Dua in Vietnam PNG LNG – Expansion Multiple TCF gas prospects opportunities in Bay of Bengal PNG LNG – significant project underpinned by Near-term oil and gas development world class gas res

  34. Slide 34: LNG is a key component of Santos' Growth Strategy

    LNG is a key component of Santos’ Growth Strategy For personal use only Strategy Bonaparte LNG Components  2mtpa FLNG PNG LNG  Santos 40% with carry to FID  On track for FID 4Q09  6.3mtpa two trains Deliver the  Santos 13.7% Darwin LNG Base Business  Commenced production in 2006  3.25mtpa sin

  35. Slide 35: GLNG: The Leading CSG to LNG Project

    GLNG: The Leading CSG to LNG Project For personal use only Momentum building towards FID in first half of 2010  Freehold land for liquefaction plant   Pre FEED work completed   PETRONAS selected as partner   LNG marketing well underway   Reserves build on track   Downstream FEED entry  

  36. Slide 36: GLNG: Downstream update

    GLNG: Downstream update For personal use only  Curtis Island site - EIS application for 10mtpa capacity (3 trains)  Downstream FEED - Bechtel appointed - 2-train FEED 40% complete - Curtis Island geotechnical site survey work complete  Pipeline FEED - GHD appointed - FEED 50% complete  Marketing

  37. Slide 37: PNG LNG, Darwin LNG and Bonaparte LNG

    For personal use only PNG LNG, Darwin LNG and Bonaparte LNG 19 PNG LNG on Track for 4Q 2009 FID  Pre FEED work on two train  6.3mtpa plant  Marketing Representative Agreement   Coordinated Development and Operating Agreement   Gas Agreement   Front End Engineering Design Entry Decision  

  38. Slide 38: Darwin LNG & Timor/Bonaparte/Browse

    Darwin LNG & Timor/Bonaparte/Browse For personal use only Multiple pathways to growth Darwin LNG Barossa  Santos 11.4% Evans Caldita Shoal Bayu-Undan  Base project continues to deliver with potential upside unfolding Darwin Indian Petrel Timor Bonaparte Ocean Tern  Santos has material contingent

  39. Slide 39: Burnside-1 – Great street address

    Burnside-1 – Great street address For personal use only 121˚ 122˚ 123˚ 124˚ 125˚ Legend Montara Santos acreage Oil field Crux -13˚ Gas field Argus Territory of Asmore WA-274-P & Cartier Islands WA-410-P WA-274-P Poseidon WA-274-P Concerto Cornea Echuca Mimia Shoals Torosa Ichthys -14˚ Caswell WA-411

  40. Slide 40: Santos' Leading CSG Acreage Position

    Santos’ Leading CSG Acreage Position For personal use only Greater Fairview Denison Gladstone Queensland Bowen  7,300 km2 (gross)  6,500 km2 (gross) Basin  115 TJ/d production  Exploration stage  Active development & appraisal programme Greater Roma Greater Scotia  7,700 km2 (gross)  2,500 km

  41. Slide 41: Production Delivery

    Production Delivery For personal use only Fairview production has reached 115TJ/d… Santos’ Operated CSG Sales Production Growth 160 Compressor Site 3 & Increased Water Fairview-Wallumbilla Capacity 140 Pipeline Tie-in & Operational Completed Compressor Site 2 120 Tipperary Compressor Expansion Acqui

  42. Slide 42: Managing Coal Seam Gas Water

    Managing Coal Seam Gas Water For personal use only Diversified water management strategy is being implemented  3 Pronged Strategy Irrigation - Irrigation - Injection Reverse Osmosis - Reverse Osmosis  Irrigation - 887,000 trees planted to date Cropping - Targeting 1.2m trees receiving 12.2 ML/day

  43. Slide 43: Demand for Eastern Australia gas

    Demand for Eastern Australia gas For personal use only Demand will more than double within 10 years… 1800 1600 Planned 1400 LNG Projects PJ/a 1200 1000 Carbon driven fuel switching 800 10 Year Historic Average 600 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Source: NEMMCO, Santos, company anno

  44. Slide 44: Enviable existing gas infrastructure

    Enviable existing gas infrastructure For personal use only Mt Isa Townsville  Supply and demand centres are effectively Gladstone Fairview networked Ballera Roma  Further investment is Wallumbilla Brisbane Moomba needed to enhance deliverability from some emerging supply areas Gunnedah Sydney Adel

  45. Slide 45: Leading position in Gunnedah Basin

    Leading position in Gunnedah Basin For personal use only Basin master position in quality basin with >50 tcf prospective potential  ESG operated areas (STO 48%)1 Wilga Park Power Station - 9 coreholes drilled of 20 well PPL 3 Narrabri New programme PEL 434 PAL 2 South Wales PEL 238 - Stepping out e

  46. Slide 46: Western Australia Domestic Gas

    Western Australia Domestic Gas For personal use only Santos portfolio is well placed to supply the WA domestic market  2008 gas and condensate Mutineer Fletcher production 5 mmboe Exeter  Established infrastructure Legendre  John Brookes ramp-up: 200PJ uncontracted 2P reserve Reindeer  Reindeer

  47. Slide 47: Reported & underlying profits

    Reported & underlying profits For personal use only Reported NPAT: 1st half Underlying NPAT: 1st half $m 320 304 283 (161) 280 240 200 160 (20) 120 102 102 prices 80 & fx other 40 0 2008 2009 2008 2009 39 EBITDAX  Lower prices and Operating Gas lower value product Prices Mix Costs Purchases Other m

  48. Slide 48: Segment EBITDAX Summary

    Segment EBITDAX Summary For personal use only Segment Half Year Half Year Change $m 2009 2008 % Eastern Australia 318 451 (29) WA&NT 285 474 (40) GLNG 8 38 (79) Asia Pacific 64 102 (37) Corporate and unallocated items (28) (33) 15 TOTAL EBITDAX 647 1,032 (37) Eastern Australia | Lower liquids prices

  49. Slide 49: Reference slides: Indonesia – Oyong & Wortel

    For personal use only Reference slides Indonesia – Oyong & Wortel  Oyong Phase 1 (oil) - First oil achieved in September Java Sea 2007 Oyong Maleo  Oyong Phase 2 (gas and oil) Sampang PSC - 60km pipeline to Grati Surabaya - Gas sales to PT Indonesia Power Madura Offshore PSC - Engineering and cons

  50. Slide 50: Vietnam

    Vietnam For personal use only  Prospective, lightly explored China Vietnam basins Burma Song Hong Laos Basin  Multiple, material play types 101-100/04 PSC  Oil and gas potential Thailand South China Sea  Rapidly growing markets Phu Khanh Cambodia Basin  Strong regulatory regime 123 PSC Nam Con

  51. Slide 51: Bay of Bengal – India / Bangladesh

    Bay of Bengal – India / Bangladesh For personal use only  Material Gas targets India  Enormous, underexplored, prospective Bangladesh tertiary delta near rapidly emerging India markets Sangu  India - PSC’s signed March 2007 Burma Bay of Bengal - Processing of 2D seismic survey completed - 4000 km

  52. Slide 52: 2009 Capital expenditure outlook

    2009 Capital expenditure outlook For personal use only (A$ million) 2009 2008 Capital expenditure 1,600 1,500 Acquisitions 476 5 Disposal proceeds1 (304) (2,052) 1 (pre tax, reported to date for 2009) 49 2009 Second Half Sensitivities Sensitivity Change NPAT Impact A$m US dollar oil price US$1/bbl 8

  53. Slide 53: Oil Price A$/bbl; Contact Information

    Oil Price A$/bbl For personal use only 1st half 2008 1st half 2009 180 160 140 Average: A$120.51 Current A$84.55 120 A$/bbl 100 80 Average: A$73.28 60 40 Jan 08 Jun 08 Jan 09 Jun 09 51 Contact Information Registered and head office Andrew Nairn Share Register Group Executive Investor Relations Adela

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