Santos released its 2012 fourth quarter activities report today, announcing an increase in production of 10% and record quarterly and annual sales revenue.
2012 production up 10%, record quarterly and annual sales revenue
- Santos today announced a 10% lift in annual production to 52.1 million barrels of oil equivalent (mmboe) and record quarterly and annual sales revenue.
- December quarter production of 13.2 mmboe was 13% higher than the corresponding quarter and sales revenue for the quarter was up 8% to a record $876 million.
- December quarter natural gas, ethane and LNG production was 18% higher than the corresponding quarter, primarily due to stronger production from the Carnarvon, Cooper and Otway Basins, combined with higher output from Darwin LNG and GLNG.
- The average gas price of $5.06/GJ for the December quarter was 9% lower than the corresponding quarter, which included the favourable Maleo gas price review in Indonesia. The average gas price for the year of $5.14/GJ was 9% higher than the previous year.
- Sales revenue for the year was a record $3.2 billion, driven by the 33% increase in crude oil production.
Key activities during the period
- Significant gas discovery at the Crown-1 exploration well in WA-274-P, located in the Browse Basin offshore Western Australia. Santos also farmed-in for a 30% interest in the adjacent permit WA-408-P and drilling commenced on the Bassett West-1 exploration well in the permit.
- PNG LNG capacity increased to 6.9 million tonnes per annum (mtpa) and the operator confirmed the project remains on track for first LNG in 2014. The capital cost estimate was increased to US$19 billion.
- GLNG is now 45% complete and remains on track for first LNG in 2015. Significant milestones achieved for the GLNG underground gas transmission pipeline with the arrival of the last shipment of pipe in Queensland and the commencement of pipeline burial.
- Australia’s first commercial shale gas production was achieved from the Moomba-191 well.
- Farm-in agreement executed with Tamboran Pty Ltd for Santos to earn up to a 75% interest in permits in the McArthur Basin prospective shale gas and oil resource, onshore Northern Territory.
Santos Chief Executive Officer David Knox said new producing assets such as Reindeer and Chim Sáo, combined with strong Cooper oil production, drove a 10% lift in Santos’ output in 2012.
“Higher oil production allowed us to capitalise on favourable prices this year delivering the highest sales revenue in the company’s history,” Mr Knox said.
“In 2012 we continued to deliver in our base business as well as laying the foundations for future growth. In Western Australia, we sanctioned the Fletcher Finucane oil project and made a material gas discovery at Crown. In the NT, we farmed-down Caldita Barossa and completed two farm-ins into prospective onshore acreage in the Amadeus/Pedirka and McArthur Basins.
“The Cooper Basin produced its highest oil output in three years and Australia’s first commercial shale gas, while we advanced plans for the Moomba infrastructure upgrade.
“In Asia, Chim Sáo delivered a significant boost to our oil production, the Wortel gas project in Indonesia was completed on budget, and we progressed the South Sumatra CSG opportunity.
“Construction progress on our LNG projects is pleasing with PNG LNG more than 70% complete and GLNG 45% complete. The projects remain on track for first LNG in 2014 and 2015 respectively,” Mr Knox said.
Prior period sales volume and revenue has been restated due to the change in accounting treatment of third party crude oil purchases and sales. Refer to footnote on page 4.