Santos Limited · ASX:STO
Santos — Investor Day (November 2011)
106 slides from Santos's investor day presentation, Nov 10, 2011
Slide 1: ASX Company Announcement: 2011 Investor Seminar 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 6723 TO: Company Announcements Office ASX Limited FROM: Company Secretary DATE: 10 November 2011 SUBJE
Slide 2: 2011 Investor Seminar
2011 Investor Seminar 10 November 2011
Slide 3: Disclaimer and Important Notice
Disclaimer and Important Notice This presentation contains forward looking statements that are subject to risk factors associated with the oil and g gas industry. y It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a range of variables whi
Slide 4: Today's agenda
Today’s agenda Introduction David Knox Corporate Strategy Peter Cleary Eastern Australia Business Unit James Baulderstone WA & NT Business Unit John Anderson Q&A followed by morning tea Asia Pacific Business Unit Martyn Eames GLNG P t Cleary Peter Cl Q&A Exploration p & Subsurface Trevor Brown Techn
Slide 5: A leading energy company in Australia and Asia
A leading energy company in Australia and Asia Australia A leading domestic gas Fergana Basin producer for 50 years Phu Khanh Basin Bay of Bengal LNG Timor Sea Delivering a unique Nam Con Son Basin Bonaparte Basin South Sumatra portfolio from existing East Java Basin Papua New Guinea discovered reso
Slide 6: Transformational growth pipeline
Transformational growth pipeline Upside Likely Sanctioned Producing potential sanction Cooper Basin Cooper shale Offshore Victoria Reindeer / Amadeus Queensland CSG Fletcher/Finucane Devil Creek Australia Zola Gunnedah Cooper infill John Brookes Halyard/Spar Winchester Ki
Slide 7: Delivering material production growth
Delivering material production growth Production growth to 80-90 mmboe by 2020 from sanctioned and likely sanction projects alone mmboe 90 P d ti (mmboe) Production ( b ) 80 70 60 50 40 30 20 10 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Producing Sanctioned Likely sanction Chart includes p
Slide 8: Safety
Safety A balanced focus on personnel and process safety Personnel Process safety f safety f Santos TRCFR performance Safety critical compliance long-term trend (Employees and contractors) 100% 7 able case frequency ed) rate (per miillion hours worke 6 95% 5 4 90% 3 3.1 85% 2 Total recorda 1 80% 0 20
Slide 9: Working with local landholders and communities
Working with local landholders and communities Australia’s largest domestic gas producer, Santos has a 50-year track record of safe safe, sustainable operations We are committed to working with local landholders and contributing to communities We will work in partnership with agriculture for s
Slide 10: Corporate Strategy
Drilling rig and Chim Sáo wellhead platform, Vietnam Corporate Strategy Peter Clea Pete Cleary VP Strategy & Corporate Development 9
Slide 11: Santos vision and strategy
Santos vision and strategy LNG markets LNG CHANNEL DOMESTIC O S C CHANNEL Focused Strong Asian A leading Australian growth energy base company in Australia and Asia Strategic domestic gas positions in EA and WA 10
Slide 12: Strong Australian base
Strong Australian base Santos presence in every major basin Bonaparte Darwin Proposed pipeline Browse Existing pipeline Santos assets Carnarvon NT Mt Isa Qld Amadeus WA Surat/Bowen S at/Bo en Cooper Brisbane SA NSW Gunnedah Perth Pt Bonython Adelaide Sydney Canberra Vic Melbourne Gi Gippsland l d Ot
Slide 13: Strong demand for Australian gas
Strong demand for Australian gas Demand set to quadruple by 2025 PJ/a 9 9,000 000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 , 1,000 - 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 LNG exports Domestic gas demand 12 Source: Santos and Wood Mackenzie
Slide 14: Asia is the global growth engine
Asia is the global growth engine 900 World primary energy 9 World population 180 World GDP* consumption 8 800 160 7 700 140 6 120 600 BTU BTU ople Quadrillions B Billions of peo Trillions US$ $ 5 500 Quadrillions 100 Asia Asia Asia 4 80 400 3 60 300 2 40 200 Rest of World Rest of World Rest of World
Slide 15: Asia's distinct LNG demand groups
Asia’s distinct LNG demand groups Established markets South Korea Japan 100 100 Growing markets 50 50 100 China 0 0 00 05 10 15 20 25 00 05 10 15 20 25 50 100 Taiwan 100 0 50 India 00 05 10 15 20 25 0 50 00 05 10 15 20 25 0 00 05 10 15 20 25 15 15 Vietnam Th il d Thailand 10 10 5 5 0 0 00 05 10 15 2
Slide 16: Asia Pacific LNG demand is strong
Asia Pacific LNG demand is strong Asian demand for LNG to nearly double by 2025 mtpa 350 300 250 200 150 100 50 - 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Established Growing Emerging 15 Source: Wood Mackenzie, Santos view of emerging markets
Slide 17: Asian LNG pricing
Asian LNG pricing Three distinct gas pricing structures for long-term LNG contracts; Asia to remain an oil-linked market Gas-on-gas market Oil-linked market Henry Hub NBP Oil Product JCC-linked Henry Hub 16
Slide 18: Australian LNG key to future supply
Australian LNG key to future supply By 2020, a third of global LNG production could come from Australia 120 Bonaparte LNG 110 APLNG (T2) >100 mtpa Pluto expansion by 2020 100 Gorgon expansion pa) Browse LNG 90 project (mtp Arrow LNG 80 Ichthys LNG 70 Wheatstone LNG G output by p 60 Prelude l d FLNG
Slide 19: Santos' unique LNG Portfolio
Santos’ unique LNG Portfolio Darwin (Santos 11.5%) PNG (Santos 13.5%) Conventional gas supply First gas exports from PNG GLNG (S (Santos t 30%) B Bonaparte t (Santos (S t 40%) CSG-to-LNG Floating LNG 18
Slide 20: Santos equity LNG production
Santos equity LNG production 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 19
Slide 21: Santos' LNG customers and partners
Santos’ LNG customers and partners PNG LNG Bonaparte LNG Darwin LNG GLNG 20
Slide 22: Transforming to oil-linked pricing
Transforming to oil-linked pricing 70% of 1.4bn boe 2P reserves Asset base is transformed exposed to oil prices through sanctioned projects Cooper p 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 domgas 20 contracts
Slide 23: Eastern Australia Business Unit
Kahlua pilot, Gunnedah Basin, Australia Eastern Australia Business Unit James Ba Baulderstone lde stone VP Eastern Australia 22
Slide 24: Eastern Australia – capturing the future
Eastern Australia – capturing the future High-growth Permanent structural shift in east coast gas demand causing market upward pressure on gas prices Resource Large, high quality reserve and resource base across captured Eastern Australia Operating Track record of reserve expansion and operational d
Slide 25: East coast market dynamics have shifted
East coast market dynamics have shifted A permanent structural shift in the east coast gas demand will cause higher gas prices and provide opportunity for commercialisation PJ/a East coast gas demand 4,000 3,500 3,000 2,500 2,000 Gas prices will trend 1,500 towards oil-linked oil linked 1,000 intern
Slide 26: 10,600+ PJ of gas resources in eastern Australia
10,600+ PJ of gas resources in eastern Australia (YE2010) Santos has a significant resource base with geographic and geological diversity, from which to build reserves and accelerate production SE Qld Amadeus Basin# (Non-GLNG)* 2P 123 2P 157 2C 121 2C 1,056 NSW CSG^ 2P 1 216 1,216 2C 2,987 Cooper Ba
Slide 27: Significant Cooper conventional gas resource potential
Significant Cooper conventional gas resource potential Latest US drilling and completion techniques coupled with higher prices provide potential to produce a further 5,700 PJ of conventional gas Cooper conventional reserves/resources* (>16 Tcf original gas in place) 48% Multi-well pads 2C Drilling
Slide 28: Cooper conventional – infill
Cooper conventional – infill The Cooper Basin remains significantly under-drilled compared to North American experience… Cowralli (Cooper Basin) cross-section Multi-well pad drilling (50-100 acre spacing) Second well being drilled First well completed Cowralli cross-section demonstrates abundance of
Slide 29: Leading the way on unconventional exploration
Leading the way on unconventional exploration Targeting production and ~5,000 PJ resource by 2015 Prove gas content and Achieve gas flow Demonstrate 2P reserve recoverable volumes to surface commercial flows bookings 2004–2010 2011–2012 2012–2013 2013+ Acquired the Vertical well Horizontal well Eval
Slide 30: Cooper unconventional
Cooper unconventional Numerous unconventional plays are being pursued with Santos having the only independently certified 2C shale and unconventional resource bookings in the Cooper Basin Moomba field Developed TOOL DARA conventional Resource p potential* (PJ) ( ) Booked 2015 URG plays 2C 2C Target
Slide 31: NSW CSG
NSW CSG Gunnedah Basin coals are world-class, with appraisal program confirming confidence and known resources in excess of 12,000 PJ NSW CSG industry Queensland l d Goondiwindi $1.5 billion already invested Over 1,000 potential new jobs PEL 6 Si Significant ifi t llocall gas production d ti f
Slide 32: Gunnedah is a world-class CSG resource
Gunnedah is a world-class CSG resource Focus on demonstrating deliverability (current pilots >2.5 TJ/day), reserves build and finalise commercialisation path Excellent coal thickness PEL 238 total pilot production history (up to 90 metres) 4,000 Tintsfield Dewhurst 9,000 3 500 3,500 8,000 High p
Slide 33: Santos has a proven operating capability
Santos has a proven operating capability Resource to reserve Reliability and cost Technology conversion efficiencies utilisation Four F years off continued ti dCCooper Reliability R li bilit focus f reducing d i Pad P dddrilling illi reducing d i gas 2P reserve build downtime and maintenance c
Slide 34: Major infrastructure is owned and operated
Major infrastructure is owned and operated Owning and operating key infrastructure enables Santos to commercialise its resources and bring on production quickly Majority Majo it owner- o ne Mt Isa operator position South 15 major satellite Australia facilities Gas storage facilities Brisbane
Slide 35: Commercialisation options and flexibility
Commercialisation options and flexibility Value created by leveraging portfolio scale to accelerate development and meet customer demand Dual D al channels to market ma ket provide ideal Existing pipeline commercialisation Santos assets flexibility, including gas swaps Mereenie Consolidated Gunn
Slide 36: Long-term licence to operate
Long-term licence to operate Santos is committed to work collaboratively with land owners, local communities and governments to co-exist Operations O ti affect ff t only l ~1% 1% off th the surface f area, ensuring i llong- Co-existence term co-existence is achievable for the benefit of landholders
Slide 37: Eastern Australia is capturing the future
Eastern Australia is capturing the future Well positioned to capitalise on the changing market dynamics, ultimately leading to growing margins Today’s key themes Revenue and costs per barrel* Revenue $/boe High-growth 80 market 70 60 Resource captured 50 40 Operating capability 30 20 Infrastructure
Slide 38: Western Australia & Northern Territory Business Unit
Devil Creek gas plant, Western Australia Western Australia & Northern Territory Business Unit John Anderson 37 VP WA&NT
Slide 39: WA&NT – a material business
WA&NT – a material business Strong growth market, linked to Asian resource demand WA domestic Supplying the domestic market from gas two gas hubs Strong growth options to be tested in 2012 Arrested decline in oil production Targeting material increase in new oil Carnarvon oil production fr
Slide 40: Strong domestic demand driven by resources
Strong domestic demand driven by resources Mining sector growth significantly outpaces other sectors, underpinned by strong Asian demand for WA mineral exports PJ/a 500 450 400 34% 350 300 21% 250 31% 40% 200 150 100 30% 28% 50 9% 7% 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Residential/Co
Slide 41: Strategic position in two domestic gas hubs
Strategic position in two domestic gas hubs Strong growth options exist to add to this unique portfolio in 2012 Varanus Island Halyard-Spar online in June 2011 Winchester Hurricane on budget and on schedule Reindeer Beam exploration well planned for Spar p John Brookes Q2 2012 Varanus Island Dam
Slide 42: Zola and Winchester drilling in 2012
Zola and Winchester drilling in 2012 Zola >100m of net gas pay in excellent Winchester quality reservoir WA-323-P WA 323 P Multiple development options available Corvus - LNG (multiple options) - Domestic gas John Brookes New high resolution 3D acquired Indian Ocean Follow-up appraisal drill
Slide 43: Carnarvon Oil
Carnarvon Oil Arrested decline in mature oil production 10,000 Mutineer- Exeter gross oil production Mutineer-Exeter 9,000 8 000 8,000 Two successful workovers in 2011 7,000 6,000 - New generation electrical subsurface BOPD 5,000 pumps installed 4,000 - Field Fi ld life lif extended d d 3 000 3,00
Slide 44: Fletcher/Finucane oil development
Fletcher/Finucane oil development Targeting FID by Q1 2012 with first oil by 2H 2013 Successful Finucane South exploration well in May 2011 Currently in FEED on Fletcher Finucane tie-back to Mutineer-Exeter 17km pipeline & umbilical 14km pipeline & umbilical 43
Slide 45: Material Bonaparte Basin position
Material Bonaparte Basin position A critical region for Santos now… Caldita Barossa Santos 40% Darwin LNG Evans Shoal Conditional sale Continued strong production Joint NT/P48 NT/P69 Barossa Petroleum Development Evans 35-day planned shutdown in 2012 Area Shoal NT/P61 Caldita JPDA 03-12 Bayu-Und
Slide 46: Bonaparte LNG on schedule
Bonaparte LNG on schedule BLNG building momentum; >2Tcf resource Santos 40% equity and carried to FID ((GDF SUEZ 60% and operator) p ) 150 people working on the project Substantial progress on pre-FEED: Granherne (upstream) and DORIS Engineering (downstream) Project remains on schedule: - FE
Slide 47: Browse Basin
Browse Basin Drilling to commence in 2012 Well positioned Argus Territory of Ashmore - Material prospects WA 274 P WA-274-P & Cartier Islands WA-410-P - All Santos operated Crown WA-274-P - Liquids rich Poseidon Ichthys - Materiality could provide stand- Echuca alone development options Torosa Sho
Slide 48: 2012 is a key year for Santos in WA&NT
2012 is a key year for Santos in WA&NT In 2012, Santos will have three offshore operated rigs in WA&NT drilling seven firm exploration and appraisal wells 7-9 A material business Beam Clark WA domestic gas Crown Hoss Hurricane Winchester 3 3 Zola Carnarvon oil Petrel 8* Browse* Zola Finucane 1 1 Pet
Slide 49: Questions
Drilling rig, Cooper Basin, Australia Questions
Slide 50: Asia Pacific Business Unit
Chim Sáo FPSO, Vietnam Asia Pacific Business Unit Martyn Ma t n Eames VP Asia Pacific 49
Slide 51: Focused growth in Asia Pacific
Focused growth in Asia Pacific High-margin Asia’s growing energy needs driving higher domestic gas prices business Santos’ Asia Pacific production revenue increasingly oil-linked Established Indonesian business with strong track record of Strong g track project delivery record Chim Sáo proje
Slide 52: Indonesia – established business
Indonesia – established business Strong base business in East Java with increased margins and incremental growth Increased margins from rising Oyong Wortel Maleo domestic gas prices − New gas volumes sold at ~US$5-6 Madura Island per MMBTU with i h escalation l i Surabaya − New Maleo gas price agr
Slide 53: Indonesia – East Java
Indonesia – East Java East Java performing beyond expectation; incremental growth from Wortel and Peluang Sampang PSC − Oyong gross production ~2,400 bbl/d (oil) and ~60 MMscf/d (gas) − Wortel, Wortel Oyong extension jackets and pipeline in place and drilling underway − Oyong infill well to spud e
Slide 54: Indonesia – South Sumatra CSG
Indonesia – South Sumatra CSG Santos farm-in to two CSG licences in South Sumatra Leverages Santos’ CSG experience in Australia and operating experience in Indonesia Perabumulih Ogan Komering II PSC Farm-in agreement with Sugico OIG 7,8,9,10 OIG 6 gives Santos 60% equity and OIG 2 OIG 5 operator
Slide 55: Vietnam – Chim Sáo delivered
Vietnam – Chim Sáo delivered Chim Sáo project currently delivering ~30,000 bbl/day; Dua oilfield Chim Sáo north-west additional volumes intersected oil discovery Dua development area Santos equity of 31.9%, Chim Sáo oilfield Premier operator Chim Sáo p production Chim Sáo expected capital platfo
Slide 56: Vietnam – next steps
Vietnam – next steps Medium-term growth through existing oil opportunities supplemented by longer term penetration of the domestic gas market Chim Sáo upside potential to be Vietnam China Burma established through further Laos exploration and appraisal in 2012 Santos continues to explore Block T
Slide 57: Bay of Bengal
Bay of Bengal Exploration-driven opportunity to meet growing gas markets in Bangladesh and India Bangladesh India − Chittagong market significantly Bangladesh Sangu India under-supplied − Free-market gas rights obtained; Block 16 Burma discussions with buyers underway Bay of Bengal − Currently und
Slide 58: Bangladesh – exploration program
Bangladesh – exploration program Multi-well exploration program targeting short to long term gas production 3D seismic on Magnama and Bangladesh Sangu area completed in 2010 Sangu Chittagong Current Sangu production ~14 Hatia MMscf/d; Chittagong plant Block 16 (Sangu) South Sangu capacity of 500
Slide 59: PNG LNG
PNG LNG A landmark project for PNG and key component of Santos’ LNG growth Papua New Guinea 100k 100km 6.6 mtpa, two-train development, Hides operated by ExxonMobil PDL 1 Fully contracted to Sinopec, TEPCO, Osaka Gas and CPC PDL 3 PRL 9 Santos 13.5% equity LNG Plant First LNG due 2014, net p
Slide 60: PNG LNG project update
PNG LNG project update On target for first LNG in 2014 At the LNG plant site, construction of process trains, tanks and jetty are well underway Earthworks E th k and d early l construction t ti activities at Hides plant site and Komo airfield underway; rate of progress improving Stringing and
Slide 61: PNG expansion
PNG expansion Existing infrastructure will provide strong platform for PNG LNG expansion Hides Deep Prospect – PDL 1 Hides and Angore PDL 1: Hides Deep SW Hides Deep-1 Prospect NE development drilling will provide better understanding p g of potential Currently evaluating deeper Koi Iange target
Slide 62: Central Asia
Central Asia Exploration opportunity targeting short-term oil Kyrgyz Republic acreage prospectivity Kazakhstan Bishkek reduced following 2D seismic program; country exit in preparation Kyrgyz Republic O ti acreage secured Option d in i Tajikistan; T jiki t Tashkent Jalalabad initial 2D seismic h
Slide 63: Focused portfolio delivering growing margins
Focused portfolio delivering growing margins Asia Pacific will contribute ~20% of Santos’ production in 2012 Revenue Revenue and costs per barrel* US$/boe High-margin 60 business 50 40 Strong track record 30 20 Landmark LNG 10 project 0 2010 2012 2015 Focused exploration Production Costs Other Costs
Slide 64: GLNG
GLNG plant site image, Curtis Island, Australia GLNG Peter Cleary VP Strategy & Corporate Development Chair of GLNG Operating Committee 63
Slide 65: Strong progress since FID
Strong progress since FID First LNG expected in 2015 on schedule from US$16 billion two-train project World-class contractors executing with Strong team experienced project partnership team 383 wells drilled, 520 landholder agreements Upstream Fairview capacity of 1.3 TJ/day per well Water T
Slide 66: Strong partnership and contractors
Strong partnership and contractors Project partners have industry leading expertise providing end-to-end supply chain coverage Predominantly P d i tl fixed-price fi d i EPC contracting t ti strategy t t with ith world-class contractors 65
Slide 67: Experienced leadership team
Experienced leadership team Experience: 25 years oil & gas experience. President GLNG Held position of Vice President Mark Macfarlane Eastern Australia l for f Santos GLNG Project GM GM External GM Human GM Marketing Director GM Upstream GM Business GM Legal Program Director Plant Downstream Affairs
Slide 68: Upstream
Upstream 383 wells drilled to date, with 207 wells commissioned with capacity of 240 TJ/d Santos operates ope ates on g grazing a ing land, land not cropping land − 520 agreements in place with 200 landowners Arcadia Area − 34,000 hectares of land owned to be used for key development activities an
Slide 69: Fairview wells capacity
Fairview wells capacity of 200 TJ/d Fairview wells averaging 1.3 TJ/day, up 30% on Jan 2010 12.00 8000 wells (bbl/d) wells (TJ/d)) 7000 10.00 Gas capacity for Water capacity for 6000 individual wells apacity for individual w individual wells ndividual w 8.00 5000 6.00 4000 Current average gas capaci
Slide 70: Upstream development
Upstream development Expect to drill ~135 wells in 2011 and ~170 wells in 2012; updating rig fleet in 2012 Six Si drilling d illing rigs igs and six si completion rigs in operation − Wet weather in first quarter of 2011 affected the drilling program Updating the rig fleet − Pad drilling p , high
Slide 71: Reserves and resources
Reserves and resources GLNG has 9 Tcf of dedicated reserves and resources GLNG dedicated 2P+2C (PJ)2 As at 31 December 2010 NSAI estimates GLNG 10,000 ultimate 2P CSG reserves 8,000 maturation of 9,848 PJ from existing acreage1 6,000 In addition to CSG reserves, S t tto supply Santos l 750 PJ 4
Slide 72: Producing, not reducing, water
Producing, not reducing, water Queensland-first partnership between a CSG company and a private landholder Treated T t d CSG water t iis an opportunity for landholders Mount Hope p Station irrigation g project − Santos providing up to 700 ML of treated water − Further projects to be rolled out
Slide 73: Transparent water monitoring
Transparent water monitoring Santos GLNG water portal includes detailed results from more than 100 water monitoring locations www.santoswaterportal.com.au 72
Slide 74: Gas transmission pipeline
Gas transmission pipeline Production of line-pipe commenced, >100km already manufactured at 1.8 km/day Fixed Fi ed p price, ice llump-sum mp s m tturnkey nke cont contract act with Saipem − GLNG personnel embedded with Saipem in Farno, Italy − Expected to start laying pipeline 2012, on schedule −
Slide 75: Curtis Island clearing is complete
Curtis Island clearing is complete Material offloading Camp accommodation facility 3 October 2011 74
Slide 76: LNG plant
LNG plant Construction commenced on 7.8 mtpa two-train LNG plant and mainland logistics facilities Site Sit clearing l i completed, l t d bulk b lk earthworks 35% complete Construction of accommodation facility commenced Engineering and procurement >33% complete Accommodation units Completed
Slide 77: Material offloading facility
Material offloading facility Construction well advanced LNG plant site Pioneer ramp A D C B Barge berth Aggregate berth Ferry terminal Lo-Lo and Ro-Ro berth face 3 October 2011 A – J Holland’s office and laydown C – Batch plant 76 B – RO plant area D – Haul road
Slide 78: Questions
Drilling rig, Cooper Basin, Australia Questions
Slide 79: Exploration and Subsurface
Sangu and South Sangu fields, Bay of Bengal, Bangladesh Exploration and Subsurface T Trevor Brown B VP Exploration & Subsurface 78
Slide 80: Exploration and Subsurface
Exploration and Subsurface Strong track 10-year track record of adding contingent resources and record of converting to reserves and production resource adds Competitive finding costs Significant Zola discoveries in Finucane South 2011 Conventional Material prospects in WA and Asia Apply
Slide 81: Strong track record of resource adds
Strong track record of resource adds Exploration capex (US$m) Cumulative 2P+2C resource adds (mmboe) 300 1500 Finucane South,, Exploration Capex US$ Zola, Gunnedah Number of wells Spar Deep, Gunnedah 250 Cum. Resource Adds Mmboe (RHS) 1250 Peluang, Burnside, Gunnedah 200 1000 Netherby, Frigate Deep,
Slide 82: Adding resource at low finding costs
Adding resource at low finding costs 7 IHS Herold Asia Pacific 6 Santos S$/boe) 5 ng cost (US 4 3 Findin 2 2006 –2010 Santos average finding costs US$0.83/boe 1 0 2006 2007 2008 2009 2010 Forecast 2011 Barossa, Chim Barossa Magnama, Netherby, Frigate Peluang, Burnside Peluang Burnside, Spar Deep, Fi
Slide 83: Conventional - Bangladesh
Conventional - Bangladesh Application of 3D seismic has identified multiple targets Sangu and South Sangu fields – Bay of Bengal, Bangladesh 82
Slide 84: Bangladesh - North East Sangu-1
Bangladesh - North East Sangu-1 Proven petroleum system A’ Santos 100% and operator Water depth 10 metres 2 Km NE Sangu prospect mapped on 3D seismic A Rig g secured and drilling g planned p for Q1 Q 2012 Area of AVO anomaly Sangu 2 Sangu platform Sangu Sangu platform NE-1 A A’ Stacked pay 4
Slide 85: Carnarvon Basin – Winchester-1
Carnarvon Basin – Winchester-1 Winchester is on trend with NWS Rankin fields Santos 75% and operator p Water depth 80 metres Winchester-1 TD: 4,500 metres High condensate yield potential (>50bbls/mmscf) High Hi h resolution l ti 3D seismic i i currently tl recording di Rig secured and dr
Slide 86: CSG regional study
CSG regional study Santos’ 50-year onshore history provides unique knowledge for assessing g unconventional basins Detailed regional mapping supports: Queensland Denison Targeted g exploration p approach pp and Trough Galilee Dawson River Denison high grading portfolio Basin Bowen Basin Trough Fai
Slide 87: Locating the CSG sweet spots
Locating the CSG sweet spots Outcrop at a coal mine Find most prospective areas Characterise the reservoir in – thickness, gas cores/logs e.g. coal cleats content and structure 86
Slide 88: Shale, tight gas sands and deep coal
Shale, tight gas sands and deep coal Cooper Basin prospects to be drilled in 2012 Nappamerri pp Trough g Cooper p Basin One dedicated horizontal shale drilling trial and follow up fracture follow-up stimulation Three key tight gas exploration wells One deep coal exploration well Moomba 87
Slide 89: Shale gas reservoir studies
Shale gas reservoir studies Hylogger core mineralogy TOC/dispersed organic matter: Core adsorbed/free gas storage 3mm Bedding plane 1m 4m 1 i t intersection ti 3 3mm miniplug X-Ray tomogram Free gas storage in open pores of recrystallised clays 3mm miniplug Thin section of miniplug: Core miniplug (b
Slide 90: 2012 exploration program
2012 exploration program Bangladesh NE Sangu-1 Fergana Basin Hatia 3D Phu Khanh Basin 2D seismic, 2 wells Magnama Block 123 seismic Nam Con Son Basin Chim Sao NW-1 Sumatra CSG wells ll Browse Basin Cooper Basin Crown-1 Tight gas, shale and deep coal program Surat,, Bowen and Carnarvon B C Basin i Wi
Slide 91: Technical and Engineering
Ocean Sovereign, Bay of Bengal, Bangladesh Technical and Engineering Di Diana Hoff H ff VP Technical & Engineering 90
Slide 92: Strong integrated functional capability with focus on the fundamentals
Strong integrated functional capability with focus on the fundamentals Strong HSE focus Safe, S f timely l andd cost effective delivery of wells and projects 91
Slide 93: Australia, Vietnam, Indonesia, Bangladesh operations
Australia Onshore conventional Australia Vietnam Indonesia Bangladesh Offshore Australia Indonesia Onshore unconventional 92
Slide 94: Onshore Cooper Basin
Onshore Cooper Basin Three new, state-of-the-art drilling rigs – Improved rig moving and drilling efficiency – Automated A t t d systems t mean safer f operations Cost reduction through multi-well pad development – On-site simultaneous operations – Optimised fracturing process – Reduced surface
Slide 95: Onshore unconventional
Onshore unconventional Two successful surface-to-inseam projects executed at Scotia – 50% improvement in time and cost between first and d program second First in Australia and Asia: Time reduction through MZST technology Fracture stimulation “Mongoose” 100% 25% decrease (MZST) technology 80% 40
Slide 96: Offshore Asia Pacific
Offshore Asia Pacific 3 well jack jack-up up drilling campaign in progress in Bay of Bengal Established supply base in Offshore Asia Pacific Chittagong supply base Chittagong Bangladesh Chittagong, B Bangladesh l d h Safe delivery of the 123-TH-1X Vietnam well in Vietnam with ‘best in class’ d
Slide 97: Offshore Australia
Offshore Australia Successfully completed four- wellll d drilling illi and d workover k campaign in 2011 – Zero recordable incidents – Best historical performance Mutineer-Exeter workovers – Santos Santos’ largest offshore testing program conducted Followed by a very active 2012 – 7-9 wells plan
Slide 98: Funding and Guidance
Drilling rig, Cooper Basin, Australia Funding and Guidance Andrew And e Seaton Chief Financial Officer 97
Slide 99: Strong balance sheet
Strong balance sheet Balance sheet capacity to: fund execution of business strategy minimise refinancing risk Debt maturity profile $6.2 billion of funding capacity A$ million A$ billion 1,800 7 1 600 1,600 6 1,400 5 1,200 1,000 4 800 3 600 2 400 1 200 0 0 2012 2014 2016 2018 2020 Cash Undrawn U
Slide 100: Capex program fully funded
Capex program fully funded Base business and sanctioned project capex fully funded Existing $6.2 billion Capex committed undrawn excludes l d capitalised it li d interest i t t $million debt and cash at 4,000 $3.75 billion 30 September 2011 3 500 3,500 $3 billion billi Strong free cash flow 3,00
Slide 101: Production guidance
Production guidance 2011 guidance unchanged 2012 guidance of 51–55 mmboe Production 2012 production influenced by: mmboe 60 New projects: Chim Sao, Reindeer, 51-55 Halyard, Wortel 55 Higher Cooper production as 47-50 50 operations recover from flooding DLNG 35-day planned shutdown 45 Delayed
Slide 102: Wrap-up
Wrap-up David Da id Knox Kno Managing Director & CEO 101
Slide 103: Questions
Questions We have the energy.
Slide 104: 2011 Investor Seminar
2011 Investor Seminar 10 November 2011
Slide 105: 2012 exploration schedule
2012 exploration schedule Santos Well Name Basin / Area Target Timing Interest % NE Sangu-1 Bay of Bengal Gas 100 Q1 2012 Indonesia CSG Sumatra Gas 60 Q1 2012 Central Asia 2 Wells Fergana g Oil 70 Q2 2012 Q Beam-1 Carnarvon Gas 45 Q2 2012 Hoss-1 Carnarvon Oil 37.3 Q2 2012 Cooper tight gas Cooper Gas
Slide 106: Contact information
Contact information Head office Adelaide Andrew Nairn Ground Floor, Floor Santos Centre Group Executive Investor Relations 60 Flinders Street Level 10, Santos Centre Adelaide, South Australia 5000 Direct: + 61 8 8116 5314 GPO Box 2455 Email: andrew.nairn@santos.com Ad l id South Adelaide, S th A Aus