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Australia’s Santos delays Barossa first gas to 3Q 2025

  • Märkte: Crude oil, Emissions, Natural gas
  • 25.01.24

Australian independent oil and gas producer Santos has delayed expected first gas from its Barossa backfill project to July-September 2025 following legal issues that paused development of the field in Australia's Timor Sea.

Barossa will require an additional $200mn-300mn, bringing the total cost of the field designed to feed the 3.7mn t/yr Darwin LNG plant to $4.5bn-4.6bn, Santos said.

The development was hit with a lawsuit contesting an environmental plan approved for the field's pipeline, which was dismissed this month while drilling was also halted during 2023 as it consulted stakeholders in line with a 2022 Federal Court ruling.

The additional expense will be incurred in 2025, Santos said, confirming it has pushed back first gas to July-September 2025 from a previous guidance of January-June 2025. The project is 66pc complete, with drilling having recommenced and pipelaying work about 33pc complete to date.

Adelaide-headquartered Santos produced 23.4mn bl of oil equivalent (boe) for October-December 2023, taking its total output for 2023 to 92.2mn boe, at the upper end of its 89mn-93mn boe guidance. Santos produced 103.2mn boe in 2022.

The firm's fourth quarter total output of 23.4mn boe was higher than the 23.3mn boe produced in July-September, but below the 25.6mn boe in the final quarter of 2022.

LNG production rose on the quarter as seasonal shaping of the 7.8mn t/yr Gladstone LNG's domestic gas commitments over April-September was fulfilled. Full-year LNG sales were in line with guidance of around 6mn t, Santos said, while the plant produced 5.68mn t of LNG compared with 6.12mn t in 2022.

The 6.9mn t/yr ExxonMobil-operated PNG LNG produced 8.43mn t in 2023, 2pc below the 8.57mn t output reported a year earlier.

The firm said its 80,000 b/d, 51pc-owned Pikka project in the US state of Alaska was 37pc complete as of 31 December, progressing on time and on budget, with rig operations completed on five wells and work underway on the sixth well.

Flow testing on all four injection wells for its 1.7mn t/yr Moomba carbon capture and storage (CCS) project in the onshore Cooper basin in South Australia has been successfully completed, and a front-end engineering study for the planned Bayu-Undan CCS project offshore East Timor is 86pc finished, Santos said.

The 80pc complete Moomba CCS aims to begin injecting carbon dioxide in mid-2024.

"Our operational focus for 2024 is the execution of the Barossa, Pikka and Moomba CCS projects whilst maintaining a strong balance sheet," chief executive Kevin Gallagher said on 25 January.

Santos has set a production guidance for 2024 of 84mn-90mn boe, with major project capital expenditure of $1.6bn.

Santos results
Oct-Dec '23Jul-Sep '23Oct-Dec '22y-o-y % ±q-o-q % ±
Volumes ('000 t)
GLNG (100pc)1,4991,3701,620-79
Darwin LNG (100pc)4391222-81-53
PNG LNG (100pc)2,1152,1112,143-10
Santos' equity share of LNG sales1,4521,3001,428212
Financial
LNG sales revenue ($mn)9408211,269-2615
Total sales revenue ($mn)1,4861,4361,884-213
LNG average realised price ($/mn Btu)12.3312.0216.92-273
Oil price ($/bl)889095-7-2

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