Safety and environment 2016 injury performance was our best on record but first-half results show we cannot be complacent Lost Time Injury Frequency Rate three year rolling average + Actions underway to address increase in low 2012 1H…
Our strategy Three phase strategy to deliver a low-cost, reliable and high performance business + Execute and bring on-line growth opportunities across the core portfolio + Focused exploration strategy to Grow identify new…
Core portfolio provides stable production and growth Santos core assets provide stable base production for the next decade Growth opportunities include Barossa backfill to Darwin LNG and PNG LNG expansion Delivering Australias lowest…
Delivering more gas to the domestic market Santos has scale, capacity and optionality to sell into both domestic and export markets Darwin McArthur + Santos committed to delivering Very large in-place gas resource in increased gas…
2017 First-half financial results Anthony Neilson CFO Santos 2017 HY Results Page 8
2017 First-half financial snapshot Net loss of US506 million, after US689 million after tax net impairment. EBITDAX up 46% to US718 million and underlying NPAT up US161 million to US156 million Free cash flow Unit upstream Operating…
Production and sales volumes Higher production and sales from the core assets. 2017 sales volume guidance upgraded to 77-82 mmboe Production Sales volume mmboe mmboe 43.2 40.9 40.1 31.1 30.5 29.4 29.5 28.3 33.4 30.9 1H15…
Transforming underlying earnings Cost-out and efficiency gains combined with higher realised prices drive higher earnings. First-half underlying NPAT increased to US156 million compared to a loss in 1H 2016 Product sales revenue EBITDAX…
Strong free cash flow generation First-half free cash flow (before asset sales) of US302 million continues trend of improving free cash flow in a lower oil price environment Operating cash flow Investing cash flow1 Free cash flow1 US…
Capital expenditure First-half capex US321 million. 2017 capex guidance maintained at US700-750 million + First-half capital expenditure of US321 million Capital expenditure1 US million + includes Muruk acquisition and exploration…
Impairment Previously announced non-cash net impairment of US689 million, primarily due to lower oil prices + In determining the carrying value of its assets, GLNG: net impairment of US867 million Santos considers a range of asset…
Net debt reduced to US2.9 billion Target US2 billion in net debt by the end of 2019 + Net debt reduced to US2.9 billion through 2017 first-half movement in net debt USmillion a combination of free cash flow, previously announced…
Re-financing Euro hybrid to reduce interest costs Euro hybrid to be redeemed and Santos expects to issue new lower-cost debt in the near- term. Targeting significant annual interest cost savings Drawn debt maturity profile as at 30 June…
Hedging reduces impact of commodity price volatility Prudent oil price hedging retains exposure to oil price upside at zero cost 2017 Zero-cost three-way collar hedge Zero-cost three-way collar hedge Short call 70 Open oil price…
Operations review Kevin Gallagher Managing Director and CEO Santos 2017 HY Results Page 18
PNG Record PNG LNG performance drives higher EBITDAX. Expansion of PNG LNG likely and details evolving + EBITDAX higher due to strong operating Asset KPIs 1H17 1H16 performance, lower unit costs and higher Production (mmboe) 6.2 5.9…
PNG - Muruk gas discovery Material gas field 21 kilometres northwest of Hides. Follow-up potential, Karoma prospect Drilling and testing results Approvals and forward plan + Muruk-1 and sidetracks encountered two + Muruk-2 appraisal well…
Northern Australia Strong Darwin LNG performance and successful Barossa two-well appraisal campaign + EBITDAX 22% higher mainly due to higher LNG Asset KPIs 1H17 1H16 prices Production (mmboe) 2.1 2.2 + DLNG operated at 3.4 mtpa…
Northern Australia exploration and appraisal Barossa two-well appraisal campaign strengthens position as lead candidate for DLNG backfill Northern Australia + Two-well Barossa appraisal drilling campaign successfully completed (Santos…
Cooper Basin Lower forecast costs allowing increased drilling activity and acceleration of planned program + EBITDAX 51% higher due to lower cost Asset KPIs 1H17 1H16 operations, improved productivity and higher oil prices Production…
Cooper Basin cost base materially lower 58% reduction in drilling costs and 93% improvement in drilling efficiency since 2014 Cooper gas development drill, frac, complete costs Wells drilled with 2 rigs USmillion per well -58% +93% 6.6…
GLNG GLNG LNG sales expected to ramp-up to 6mtpa by end of 2019 and remain at that level + EBITDAX 140% higher reflecting the Asset KPIs 1H17 1H16 ramp-up of Train 2 and higher LNG prices Production (mmboe) 5.6 4.3 + Upstream unit…
GLNG cost base materially lower Proven cost performance now allows GLNG to increase drill, complete and connect activities. Acceleration of development activity will unlock more near term gas supply Roma drill, complete, connect Roma…
WA Gas Low cost operations with capacity and reserves to meet short and long-term demand + EBITDAX lower due to settlement of a revised Asset KPIs 1H17 1H16 gas sales agreement in 1H 2016 Production (mmboe) 4.3 4.7 + Production lower…
Other assets Packaged and run separately for value as a standalone business. Portfolio to be continually optimised to maximise value + EBITDAX 13% higher due to due to higher Asset KPIs 1H17 1H16 prices + Sale of Victoria and…
Summary Create shareholder value by becoming a low-cost, reliable and high performance business + A disciplined strategy focussed on five core long-life natural gas assets, each with significant upside potential + strong operating…
2017 First-half results Appendix Santos 2017 HY Results Page 30
Financial performance EBITDAX up 46% to US718 million. Underlying NPAT up US161 million to US156 million First-half First-half + Product sales revenue up 22% US million Var 2017 2016 driven by favourable product Product sales revenue…
Sales revenue Sales revenue up due to higher LNG sales volumes and higher prices First- First- + Sales revenue increased by 22% US million half half Var due to higher LNG sales volumes 2017 2016 reflecting the ramp-up of GLNG Sales…
Production costs Upstream unit production costs improved 8% to US8.08/boe First-half First-half Var + Upstream unit production costs US million 2017 2016 down 8% to US8.08/boe Production costs 239 273 (12)% + GLNG down 19% to…
Cash flow Operating cash flow up 127% to US662 million. Free cash flow breakeven reduced to US33/bbl1 First-half First-half Var + Operating cash flow up 127% to USmillion 2017 2016 US662 million Operating cash flow 662 291 127% +…
Significant items Reconciliation of half-year net loss to underlying profit First-half First-half USmillion 2017 2016 Net profit/(loss) after tax (506) (1,104) Add/(deduct) significant items after tax Impairment losses 689…
Liquidity and net debt as at 30 June 2017 US4.2 billion in cash and committed undrawn debt facilities Liquidity (USmillion) 30 Jun 2017 31 Dec 2016 Cash 2,226 2,026 Undrawn bilateral bank debt facilities 2,020 2,313 Total…
2017 First-half segment results summary Corporate First-half 2017 Cooper Northern Other explorn & USmillion Basin GLNG PNG Australia WA Gas Assets elimins Total Revenue 395 358 250 78 135 170 110 1,496 Production costs (69) (34)…
2016 First-half segment results summary Corporate First-half 2016 Cooper Northern Other explorn & USmillion Basin GLNG PNG Australia WA Gas Assets elimins Total Revenue 353 224 210 71 74 217 56 1,205 Production costs (85) (31)…
2017 Guidance 2017 sales volumes expected to be between 77 and 82 mmboe and production to be between 57 and 60 mmboe 2017 Guidance Sales volumes 77-82 mmboe Production 57-60 mmboe Upstream production costs US8-8.25/boe DD&A…
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