Santos Limited · ASX:STO

Santos — Investor Presentation (September 2011)

29 slides from Santos's investor presentation, Sep 22, 2011

  1. Slide 1: ASX cover note: Investor Presentation September 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 For personal use only TO: Company Announcements Office ASX Limited FROM: Company Secretary DATE:

  2. Slide 2: Disclaimer and Important Notice

    For personal use only Investor Presentation September 2011 1 Disclaimer and 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 reasona

  3. Slide 3: Santos overview and vision and strategy

    Santos overview For personal use only Regional footprint of operations  One of Australia's leading upstream oil and gas companies and has been Hai Phong Basin Kyrgyz Republic operating since 1954 Phu Khanh Basin Bangladesh  Current production: Kutei Basin India Timor Sea & Timor Gap - ~600 mmscf/d

  4. Slide 4: Transforming to oil-linked pricing; Safety performance

    Transforming to oil-linked pricing For personal use only 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

  5. Slide 5: Working with local landholders; 2011 first-half highlights

    Working with local landholders and communities For personal use only  One of Australia’s largest gas producers, Santos has a 50-year track record of safe, sustainable operations  We W are committed itt d tto working ki with ith llocall llandholders dh ld and d contributing to communities  We will

  6. Slide 6: Half-year net profit up 155%; Strong balance sheet

    Half-year net profit up 155% For personal use only 2011 Half-year result Change on 2010 first-half Production 22 9 mmboe 22.9 (5%) Sales revenue $1,101 million 1% EBITDAX $1,089 million 66% Net profit after tax $504 million 155% Underlying net profit $236 million 12% Operating cash flow $681 million

  7. Slide 7: Growth in LNG

    For personal use only GLNG FID signing ceremony, 13 January 2011 L to R: Mike Sangster (Total), Heung Bog Lee (KOGAS), David Knox, Datuk Anuar Ahmad (PETRONAS) Growth in LNG 11 LNG is a key component of Santos’ growth strategy Bonaparte LNG Strategy  2 mtpa FLNG Components PNG LNG  Santos S t 40%

  8. Slide 8: Strategy delivers material LNG growth; LNG customers and partners

    Strategy delivers material LNG growth For personal use only Santos equity LNG production fromGLNG T1 discovered resources existing mtpa 5 BLNG 4 GLNG T2 3 2 GLNG T1 1 Excludes PNG LNG expansion PNG LNG Darwin LNG 0 2010 2020 13 Santos’ LNG customers and partners PNG LNG Bonaparte LNG Darwin LNG GLNG

  9. Slide 9: Continue to see strong long-term LNG pricing

    Continue to see strong long-term LNG pricing For personal use only Asian Term Prices  Recent contracts point $18 Late 2006 to strong underlying $16 2008-10 demand Ex-ship LNG Price ($/MMBtu $14 Ex-Ship LNG Price ($/MMBtu) US$12/MMBtu  Pricing reflects new Mid 2006 supply-demand $12 Oil Parity equi

  10. Slide 10: GLNG plant site, Curtis Island

    GLNG plant site, Curtis Island For personal use only LNG plant site schematic 9 August 2011 17 GLNG material offloading facility site 9 August 2011 9 August 2011 18 9

  11. Slide 11: GLNG: construction progressing to schedule and budget

    GLNG For personal use only Construction progressing to schedule and budget  FID Jan 2011  7.8 mtpa, two trains  Santos 30%  LNG off-take agreements with PETRONAS & KOGAS  Clearing of LNG plant site on Curtis Island 90% complete First batch of GLNG line-pipe  Bulk earthworks 20% complete  Prod

  12. Slide 12: Beneficial use of CSG water

    Beneficial use of CSG water For personal use only Santos GLNG President Mark Macfarlane with landowners Ree and Leon Price on their property. 21 PNG LNG, Darwin LNG and Bonaparte LNG 22 11

  13. Slide 13: PNG LNG: progressing towards first LNG in 2014

    PNG LNG For personal use only Progressing towards first LNG in 2014  FID Dec 2009  6.6 mtpa, two trains  Santos 13.5%  Four Asian LNG buyers  Design for major EPC contracts nearing completion, procurement well underway  LNG train foundations, structural Line-pipe at Kopi shore base steel and L

  14. Slide 14: Bayu-Undan/Darwin LNG; Bonaparte LNG

    Bayu-Undan/Darwin LNG For personal use only 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

  15. Slide 15: Browse Basin drilling in 2012

    Browse Basin For personal use only Drilling in 2012 Keeling Montara Territory of Ashmore & Cartier Islands Crux WA-274-P Argus WA-410-P WA-274-P Ichthys Heywood Adele Poseidon North Cornea Legend Indian Echuca Santos acreage Ocean Shoals Other acreage Torosa Ichthys Oil field WA-281-P Gas field Casw

  16. Slide 16: Gas is under-utilised in Australia

    Gas is under-utilised in Australia For personal use only Gas penetration as percentage of power generated 80% 80% 71% 70% 70% 70% 60% 56% 60% 48% 50% 50% 47% 43% 40% 34% 40% 30% 27% 24% 30% 20% 20% 14% 13% 20% 14% 17% 12% 12% 10% 10% 6% 2% 2% 0% 0% Malaysia India China Japan South Korea US Thailand

  17. Slide 17: Cooper Basin exploration; Proposed acquisition of Eastern Star Gas

    Santos continues to explore Cooper Basin potential For personal use only Moomba  New state-of-the-art three-rig drilling fleet Developed TOOL commissioned in Q2 2011 Conventional - Efficiencies Effi i i recordedd d ini drill-time d ill ti and d fuel f l consumption ti DARA - Rigs built to suit infi

  18. Slide 18: Delivering strategic benefits; WA domestic gas demand

    Delivering strategic benefits to Santos For personal use only  Consolidates Santos’ existing New Gunnedah interests, resulting in South Wales S nto becoming Santos be oming llargest ge t holde holder of PEL 238 Narrabri PPL 3 NSW CSG reserves PEL PAL 2 434  Furthers Santos’ Eastern Australian Gunn

  19. Slide 19: Hub-led strategy; Halyard/Spar, WA

    Hub-led strategy For personal use only Santos supplies gas via one of two existing hubs and one new hub under construction Indian Ocean Reindeer Focused NFE Legend Santos acreage John Brookes Oil field Gas field Halyard Oil pipeline /Spar Varanus Is. Gas pipeline Gas hub Spar Devil Creek Western Aus

  20. Slide 20: Reindeer/Devil Creek, WA; Zola discovery

    Reindeer/Devil Creek, WA For personal use only Reindeer/Devil Creek – WA’s new domestic gas hub Project Reindeer/Devil Creek L Location ti C Carnarvon Basin, B i offshore ff h WA Santos interest 45% Partner Apache 55%, operator Project scope  Unmanned, minimum facility wellhead platform Reindeer we

  21. Slide 21: Finucane South discovery

    Finucane South discovery For personal use only Oil discovery with quick cycle time to first production  Finucane South-1 oil discovery Fletcher Mutineer WA-191-P  18 metre net oil column in excellent Exeter Angel formation reservoir sands Perseus Angel Finucane South  Proximity to Fletcher oil fi

  22. Slide 22: Chim Sáo, Vietnam; Indonesia: Maleo and Oyong

    Chim Sáo, Vietnam For personal use only Chim Sáo – New oil production for Santos Project Chim Sáo Location Block 12W, offshore Vietnam Santos interest 31.875% Partners Premier 53.125%, operator PetroVietnam 15% Project scope  Unmanned, minimum facility wellhead platform  Liquids processing and exp

  23. Slide 23: Wortel, Indonesia; Bay of Bengal

    Wortel, Indonesia For personal use only Wortel – Third operated project in Indonesia Project Wortel Location Sampang PSC, offshore East Java, Indonesia Santos interest 45%, operator Partners SPC 40% Cue Energy Resources, 15% Project scope  Unmanned, minimum facility wellhead platform  10-km gas pi

  24. Slide 24: Reference Slides: 2011 Guidance is unchanged

    For personal use only Reference Slides 45 2011 Guidance is unchanged Item 2011 Guidance Production 47 – 50 mmboe Production costs $550 – $590m DD&A expense $12 – 13/boe Royalty related taxation expense (after tax)1 $80 – $100m Capital expenditure (including exploration & $3 billion evaluation)2 1 Ro

  25. Slide 25: 2011 Exploration schedule; Reported and underlying profits

    2011 Exploration schedule For personal use only Santos Well Name Basin / Area Target Interest Timing % Zola-1 Carnarvon Gas 24.8 Gas discovery Cana-1 Gunnedah CSG 25.0 CSG discovery Finucane South-1 Carnarvon Oil 33.4 Oil discovery Tuy Hoa-1X Phu Khanh Oil 50.0 Q3 Tardrum-4 Bowen-Surat CSG 50.0 Q4 T

  26. Slide 26: Production lower due to GLNG sell-down; Sales volumes and revenue

    Production lower due to GLNG sell-down For personal use only  Santos interest in GLNG Production production reduced from mmboe 60% to 30% following 25 24.2 (0 8) (0.8) 0.4 (0.9) 22.9 the sale of interests to Total and KOGAS 20  Higher Bayu-Undan 15 production due to shutdown in previous 10 first h

  27. Slide 27: Production cost and cost of sales; Business unit EBITDAX

    Production cost and cost of sales For personal use only Cash production Total cost of $m costs $m sales $11.44 300 / boe $11.37 800 $24.70 $25.11 / boe b / boe b / boe 700 Third party 250 $70m product purchases $117m 600 200 500 $276m 150 $260m 400 $634m Cost of $576m 300 produced 100 hydrocarbons1

  28. Slide 28: DD&A; Interest and tax

    DD&A For personal use only  Higher DD&A primarily due $m 277 Rate 21 Volume (12) 286 to asset additions and year 300 end 2010 reserve revisions 250  Partially offset by impact of 200 lower production volumes 150  Full year 2011 guidance unchanged at $12-13/boe 100 50 0 HY-2010 HY-2011 $11.45/boe

  29. Slide 29: 2011 Sensitivities; Contact Information

    2011 Sensitivities For personal use only Sensitivity Change NPAT Impact A$m US dollar oil price +US$1/bbl +9 Gas price +10 cent/GJ +17 A$/US$ exchange rate +1 cent -8 55 Contact Information Head office Adelaide Andrew Nairn Ground Floor, Santos Centre Group Executive Investor Relations 60 Flinders S

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