Slide 1: 2022 Climate Change Report Investor Briefing Presentation
2022 Climate Change Report Supplying critical fuels more sustainably Investor Briefing Presentation 31 March 2022
Slide 2: Disclaimer and forward-looking statements
2022 Climate Change Report Disclaimer and forward-looking statements This report 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: Agenda
2022 Climate Change Report Agenda Kevin Gallagher Jane Norman Brett Darley Brett Woods Kevin Gallagher Managing Director Vice President Strategy President Upstream President Midstream Managing Director and Chief Executive Officer Oil and Gas and Clean Fuels and Chief Executive Officer 10:05am 10:25a
Slide 4: Strategy
2022 Climate Change Report Strategy Kevin Gallagher Managing Director and Chief Executive Officer Investor Briefing I 3
Slide 5: Overview
2022 Climate Change Report Overview We aim to deliver superior shareholder returns whilst being a global leader in the transition providing cleaner energy and clean fuels that are affordable and sustainable 1 2 3 4 5 Santos has a Our climate Our plan is to We will do Transition to robust climate tra
Slide 6: Transform Build Grow strategy
2022 Climate Change Report Transform Build Grow strategy Consistent and successful strategy supporting our Grow new revenue from carbon credits for new technologies Vision and Purpose (eg DAC, post combustion capture (PCC), CCS services) and nature based offset projects Grow Develop clean fuels proj
Slide 7: Strong free cash flows from five core producing assets
2022 Climate Change Report Strong free cash flows from five core producing assets Decarbonisation focus and market-led, profitable transition to a lower carbon future Balance & Scale & Market-led, profitable Re-set diversification decarbonisation energy transition 2016-2017 2018-2020 2021-2025 2026+
Slide 8: Delivering on our commitments
2022 Climate Change Report Delivering on our commitments Track record of doing what we say Net-zero 2025 Scope 1 and 2 emission Energy CCS CO2 emissions reduction solutions projects storage by 2040 targets Climate Transition Accelerated delivery Since 2017, Moomba Phase 1 100 million tonnes Action P
Slide 9: Net-zero Scope 1 and 2
2022 Climate Change Report Our goal is to achieve net-zero Scope 1 & 2 emissions by 2040 New 2030 Scope 1 and 2 absolute and emissions intensity reduction targets 2030 2040 Absolute Intensity Absolute Target Net-zero Target Target Target 30% reduction in 40% reduction in Reduce Scope 3 Scope 1 and 2
Slide 10: Climate transition action plan
2022 Climate Change Report Climate transition action plan Our Climate Transition Action Plan provides a clear pathway to net-zero scope 1 and 2 emissions with medium and long term targets Categories Description Initiatives and Indicative timeline We will report progress Operational Broad range of in
Slide 11: Evolving to support the transition to clean fuels
2022 Climate Change Report Evolving to support the transition to clean fuels Positioned to decarbonise the base business and develop new revenue streams through clean fuels and carbon solutions 2016 Traditional E&P business 2022 Delivering CCS, clean fuels and low carbon solutions Upstream Midstream
Slide 12: Markets and resilience
2022 Climate Change Report Markets and resilience Jane Norman Vice President Strategy Investor Briefing I 11
Slide 13: Gas demand remains strong amid supply constraints
2022 Climate Change Report Gas demand remains strong amid supply constraints Continued investment required to ensure secure, reliable and affordable supply Geopolitical unrest, recovering economic activity and lower LNG Average annual commodity prices 2 availability due to underinvestment has placed
Slide 14: Strong long-term demand for LNG
2022 Climate Change Report Strong long-term demand for LNG Historical underinvestment and project delays continue to limit near-term supply growth Historical underinvestment and project delays limit supply growth Global LNG supply and demand 1 Lack of investment and COVID construction delays have le
Slide 15: Natural gas – a future fuel underpinning the energy transition
2022 Climate Change Report Natural gas – a future fuel underpinning the energy transition Natural gas is critical to ensuring energy remains reliable and affordable as economies decarbonise More than half the world’s natural gas supply is used World Natural Gas Consumption (EJ) 1 in sectors other th
Slide 16: Santos is resilient and sustainable through the energy transition
2022 Climate Change Report Santos is resilient and sustainable through the energy transition Portfolio tested against a range of scenarios including two 1.5 degree scenarios The Stated Policies Scenario (STEPS) is >35% value Relative value of current portfolio and CCS and clean fuels accretive compa
Slide 17: Large scale-up of CCS required to meet climate objectives
2022 Climate Change Report Large scale-up of CCS required to meet climate objectives Oil and gas industry is best placed to deliver CCS leveraging existing capability Global forecast CCS capacity 1 Global CCS forecast, IEA SDS 2 Total CCS capacity required per annum by 2050 3 900 MtCO2 pa MtCO2 pa 9
Slide 18: CCS is a key enabler for Santos' energy transition strategy
2022 Climate Change Report CCS is a key enabler for Santos’ energy transition strategy Santos has a competitive advantage to deliver value through the transition with Moomba CCS project sanctioned, Bayu-Undan CCS in FEED and Offshore WA in concept stage Electrification and integration of renewables
Slide 19: Upstream
2022 Climate Change Report Upstream Brett Darley President Upstream Oil and Gas Investor Briefing I 18
Slide 20: Diversified portfolio with strong cashflows
2022 Climate Change Report Diversified portfolio with strong cashflows Five core producing gas assets Queensland and Northern Australia Cooper Basin New South Wales Western Australia and Timor-Leste Papua New Guinea Asset type Onshore fields to domestic & LNG facility Oil FPSOs and offshore gas Offs
Slide 21: Maximise value of five core long-life producing assets
2022 Climate Change Report Maximise value of five core long-life producing assets Disciplined and phased investment to backfill core producing gas assets beyond 2040 Queensland and Northern Australia Cooper Basin New South Wales Western Australia and Timor-Leste Papua New Guinea Low cost development
Slide 22: Five core producing assets generating strong free cash flow
2022 Climate Change Report Five core producing assets generating strong free cash flow Core asset portfolio focused on generating strong free cash flow, maintaining production and reducing emissions intensity. Targeting 40% reduction in emissions intensity by 2030 Forecast 2022 free cash flow 1 Scop
Slide 23: Midstream and clean fuels
2022 Climate Change Report Midstream and clean fuels Brett Woods President Midstream and Clean Fuels Investor Briefing I 22
Slide 24: Midstream and clean fuels portfolio
2022 Climate Change Report Midstream and clean fuels portfolio Three hubs delivering safe, reliable, low-cost operations enabling clean fuels via CCS Eastern Australia Northern Australia and Timor-Leste Western Australia Moomba Darwin LNG Varanus Island Midstream infrastructure assets Port Bonython
Slide 25: Midstream strategic priorities
2022 Climate Change Report Midstream strategic priorities Building a business with multiple revenue streams from Midstream Infrastructure, CCS and cleans fuels 2019 2021-2025 2025+ Midstream Separation Establish three Midstream and Deliver new revenues from carbon Clean Fuels Hubs credits and clean
Slide 26: Operationalising the climate transition action plan
2022 Climate Change Report Operationalising the climate transition action plan Categories Description Progress Broad range of initiatives designed to reduce Scope 1 and 2 Operational efficiency emissions from our operations 4 Since 2017, delivered annualised savings of ~300 ktCO2e pa (gross) across
Slide 27: Operational efficiency initiatives
2022 Climate Change Report Operational efficiency initiatives Since 2017, energy solutions has delivered emission reduction of ~300 ktCO2e per annum Cooper Basin Renewable Power Optimisation, Port Bonython Moomba Heat Recovery Integration Projects Western Australia Solar Farm Steam Generator Install
Slide 28: Three Santos-operated CCS and clean fuels hubs
2022 Climate Change Report Three Santos-operated CCS and clean fuels hubs Three CCS hubs enable generation of carbon credits, provision of carbon services, clean fuel production and potential for direct air capture Eastern Northern Australia Western Australia Hub & Timor-Leste Hub Australia Hub Nort
Slide 29: Competitive advantage enables low-cost CCS hubs
2022 Climate Change Report Competitive advantage enables low-cost CCS hubs Ability to leverage infrastructure and depleted reservoirs across our three operated CCS hubs Proven capture technology Transported using pipelines Storage in depleted gas reservoirs Existing capture facilities used for decad
Slide 30: CCS is proven technology
2022 Climate Change Report CCS is proven technology Decades of experience injecting gas into reservoirs at rates required to deliver Moomba CCS Santos’ extensive gas production and storage capability 1970s 1980s 1990s 2000s 2010s Santos has experience producing gas from the Cooper Basin CO2-EOR Perm
Slide 31: Moomba CCS provides step change in emission reduction
2022 Climate Change Report Moomba CCS provides step change in emission reduction FID taken in November on one of the largest and lowest-cost CCS projects, with first injection expected in 2024 Existing plant New compression & dehydration facilities US$24/tonne CO2 lifecycle breakeven cost 2021 miles
Slide 32: Bayu-Undan CCS offers a regional carbon solution
2022 Climate Change Report Bayu-Undan CCS offers a regional carbon solution Potential for up to 10 MtCO2e per annum of Santos and third party carbon services FEED commenced March 2022 Australia Facilities, pipeline, wells and reservoir injection history to capture Timor Sea all reservoir emissions f
Slide 33: Santos' low cost CCS represents natural advantage
2022 Climate Change Report Santos’ low cost CCS represents natural advantage Low cost CCS value accretive through project lifecycle Carbon abatement cost curve 1 Carbon price 2 700 Carbon abatement cost (US$/tCO2e) 700 US$/tCO2e (2021 nominal) 600 600 500 500 400 400 300 300 200 Moomba CCS $24/t NA
Slide 34: Phased investment in market-led transition to clean fuels
2022 Climate Change Report Phased investment in market-led transition to clean fuels Significant clean fuels value generation potential based on low cost CCS Domestic hydrogen demand forecast at 1-4 Mtpa by 2040 Production cost of hydrogen 1 Driven by conversion of hard to electrify sectors 6.0 US$
Slide 35: Carbon solutions
2022 Climate Change Report Carbon solutions Generating new revenue streams from carbon credits CCS expansion opportunities Direct air capture (DAC) Carbon offsets portfolio New technology Third party CCS services Cooper Basin Direct Air Capture Use our land positions across Santos undertaking R&D on
Slide 36: Summary
2022 Climate Change Report Summary Kevin Gallagher Managing Director and Chief Executive Officer Investor Briefing I 35
Slide 37: Overview
2022 Climate Change Report Overview We aim to deliver superior shareholder returns whilst being a global leader in the transition providing cleaner energy and clean fuels that are affordable and sustainable 1 2 3 4 5 Santos has a Our climate Our plan is to We will do Transition to robust climate tra
Slide 38: Question and answer session
2022 Climate Change Report Question and answer session Kevin Gallagher Managing Director and Chief Executive Officer Investor Briefing I 37
Slide 39: Definitions and abbreviations
2022 Climate Change Report Definitions and abbreviations Absolute When used in reference to emissions reduction targets means reduction against the total emissions IHS ACCS The IHS Markit Accelerated Carbon Capture and Storage scenario at the relevant point in time, rather than a relative or fixed a