Agenda Session 1 Topic Presenter Title 9:00 Welcome Andrew Nairn Head of Investor Relations 9:05 Strategy Kevin Gallagher Managing Director & CEO 9:50 Marketing, Trading & Commercial Philip Byrne Executive Vice President Marketing,…
Strategy Kevin Gallagher Managing Director & CEO
Compelling value proposition Santos has transformed into a low-cost, reliable and high performance business. Our goal is to drive shareholder value through: Diversified and balanced portfolio of long-life assets Strong stable cash…
Transform Build Grow Clear and consistent strategy + Execute and bring on-line growth opportunities across the core portfolio + Focused exploration strategy to identify new high-value targets and unlock future core assets Grow +…
Successfully delivering the strategy Strategy supportive of Santos purpose to provide sustainable returns for our shareholders Balance sheet repaired Dividend reinstated Transform Five core, long-life natural gas assets generating…
Safety and sustainability Our vision is to be the safest and lowest-cost operator Safety & Environment + Mining the Diamond to focus on eliminating incidents with potential for significant Lost time injury frequency rate (LTIFR) harm to…
Diversified and balanced portfolio Diversified and balanced portfolio generates strong stable cash flows that are leveraged to oil price upside 2017 Reserves1 mmboe + Diversified and balanced portfolio of 5 core long-life Santos…
Disciplined Operating Model Santos disciplined Operating Model provides the framework to drive value Asset lifecycle Portfolio & portfolio rules Disciplined capital management Diversified portfolio of five core long-life, natural gas…
Platform for growth Significant growth opportunities in all five core assets Santos operated assets Non-operated assets Western Australia Cooper Basin QLD & NSW Northern Australia PNG Dorado oil development Growth self-funding…
Targeting portfolio production 100 mmboe by 2025 Disciplined growth from new upstream projects leveraging-off existing infrastructure Diversified and disciplined production growth to 2025 + Strong growth outlook across all 5 core assets…
2018-19 strategic priorities Business focus aligned to the core strategy Complete Pnyang farm-in in PNG and enter FEED for expansion FID Barossa backfill to Darwin LNG Complete Quadrant acquisition and realise synergies Ramp-up…
Marketing, Trading & Commercial Philip Byrne Executive Vice President Marketing, Trading & Commercial
A leading domestic gas provider Santos continues to demonstrate its commitment to the domestic gas market with supply exceeding 120 PJ in 2018 Darwin EAST COAST WEST COAST Expect to supply Expect to supply Devil Creek 70 PJ of 50…
West Coast domestic gas The WA market is well-supplied in the near-term but significant long-term opportunities present as a result of contract roll-offs + Santos expects to supply over 50 PJ of sales gas to the west coast domestic…
East Coast domestic gas AEMO forecast no supply gaps before 2030 under expected market conditions + Santos expects to supply over 70 PJ of sales gas and ethane to the east coast domestic market in 2018 + Santos is committed to ensuring…
East coast dual-market strategy Santos positioned to benefit from commitment to domestic natural gas markets and strong Asian demand for LNG + Australias lowest-cost onshore operations focused on freeing-up reserves for the SANTOS…
Global LNG outlook The LNG market needs new supply from 2022. Supply gap of 65 mtpa forecast in 2025, aligning with Santos LNG portfolio growth opportunities Global LNG supply and demand + Demand has strengthened between 2H 2017 and 1H…
Strong contracted LNG position 90% of 2019 LNG portfolio linked to long-term contracts with strong slopes Santos LNG contract pricing + Q2 2018 realised LNG price of US9.74/mmBtu1 US/mmBtu FOB + Minimum exposure to volatile pricing…
LNG portfolio set for growth Opportunities to increase Santos equity LNG sales to 5 mtpa by mid-2020s Santos LNG portfolio growth mtpa GLNG growth 0.7 + GLNG sales to ramp-up to 6 mtpa run-rate by the end of 20191 0.4 + Opportunity…
Santos LNG netback advantage Santos assets take advantage of lower shipping costs to supply the Asian market with cost competitive LNG Shipping costs from Australia/PNG to Asia are 60-70% less than shipping from the Gulf of Mexico1…
Global oil outlook While the market appears well-supplied, the potential impact of geopolitical issues may result in tighter markets Global oil supply and demand million barrels per day + While global oil demand continues to grow, the…
Valuable and growing liquids sales portfolio High-value liquids portfolio at premium prices 2017 Liquids sales1 + Santos crude oil sales attract a premium to Brent prices mmboe 25 + Portfolio realised oil price in H1 2018 of 75/bbl…
Marketing & Trading summary A leading provider Brownfield LNG Valuable and M&T organisation of domestic gas in volumes available growing liquids resourced to meet Australia with in mid 2020s portfolio trading the challenges of 120…
Finance & Capital Management Anthony Neilson CFO
Financial discipline Strong financial and operating performance driving shareholder value Continued cost efficiencies and + Excluding the impact of shutdowns, production costs 7.79/boe in 1H18 savings being delivered through + Cooper…
Our Operating Model in action Disciplined process around cost savings and efficiencies Cooper Basin well cost1 Cooper Basin unit production cost million /boe DISCIPLINED -50% -34% 12.7 OPERATING 4.8 4.2 10.7 9.3 8.4 MODEL 2.6…
Capital expenditure 2018 capex guidance 775-825 million. Activity is increasing and we are doing more for less 2018 capital expenditure guidance 775-825 million1 Capex activities looking ahead + Cooper Basin 4-rig program drilling 85-90…
Strong free cash flow generation Diversified portfolio with strong free cash flow and EBITDAX margin across all our assets 2018 Half-year segment results summary Free cash flow1 million +22% Cooper QLD & Northern Western million PNG…
Strong liquidity maintained to provide flexibility Liquidity of 2.5 billion expected at completion of Quadrant acquisition Cash, debt and undrawn debt facilities + Net debt reduced to 2.2 billion at end August. Sale proceeds of million…
Proforma drawn debt maturity profile Proforma gross debt 5.1 billion at 31 August 2018 including new committed debt facilities associated with Quadrant Energy acquisition (subject to completion) Proforma drawn debt maturity profile as…
Quadrant acquisition Strongly value accretive acquisition PURCHASE PRICE & EFFECTIVE MATERIAL COMBINATION STRONG FINANCIAL DATE SYNERGIES ACCRETION + Effective date 1 January 2018 + Targeting combination synergies of + Materially…
Morning Tea
Onshore upstream development David Banks Vice President Onshore Upstream Projects
Cooper Basin - a new era and focus Strong fundamentals supportive of Cooper Basin growth as a high-value swing producer Cooper Basin growth enablers Dual-market east coast strategy Growing east coast market demand1 PJ Basin master…
Cooper Basin transformation to growth Low-cost, efficient drilling improved capital efficiency and higher production and reserves enables more wells leading to additions over time. Well cost1 Wells drilled Production million no of wells…
Cooper Basin more than 2P Strong resource and reserve position supports future growth 2P field life Strong conversion success 2P + 2C field life 10 years rate1 20 years mmboe % mmboe 44 100% 78% 44 100 100 2P reserves…
Targeting 17-19 mmboe production by 2025 Low-cost operating model and efficiencies underpin a focused program expected to deliver increased production and resource conversion over time Cooper Basin production mmboe drill count 20 150…
Cooper Basin Chad Wilson Vice President Upstream Cooper Basin
Delivering on our commitments Ambitious plans to further transform and grow the Cooper Basin were articulated at the 2017 Investor Day Long term production decline arrested and now growing again Drilling activity increased to 85-90…
Cooper Basin oil growth Oil production at levels not seen since early 2009 Cooper oil Daily production bopd (month average) + Santos 150 oil fields continue to deliver upside results 12,000 through innovation and low costs +51% + 20…
Cooper Basin - more than 2P Reserves High success rate from non-2P drills Drilling program project composition + Reserve replacement ratio growing YOY 2018F + 50% of 2018 program targeting Prospective & 2C project opportunities + 75% of…
Moomba South Patchawarra update First of several available large scale project appraisal programs + Moomba South appraisal program was the first large scale appraisal program selected given scale and proximity + Moomba 212 success has…
Enhanced oil recovery Matching proven technologies with Santos capabilities and existing footprint to develop opportunities that boost oil sales, drive productivity and economically reduce emissions Enhanced oil recovery using CO2 +…
Cooper Basin summary Cost and efficiency setting the stage for future growth Lowest cost onshore Develop and appraise Explore and grow operations + Free cash flow positive at + Production growing year on + Renewed focus on high…
Queensland Rob Simpson Vice President Upstream Queensland
Delivering on our commitments Strategy in place to grow equity gas production and unlock further resources Ramp-up GLNG sales to 6 mtpa run-rate by YE2019 Drilling activity increased to 300 wells in 2018 Roma well costs reduced…
GLNG ramp-up on track GLNG on track to meet 6 mtpa annualised sales run-rate including LNG volumes redirected to the domestic market GLNG LNG equivalent sales by gas supply source mtpa Building equity gas supply + Increasing…
Activity ramping-up and lower unit costs maintained Cost out and efficiencies underpin an accelerated development plan to unlock more gas over time Days - development drilling Wells drilled Well cost1 Average days rig release to rig…
Roma strong production growth Roma production continues to ramp-up Roma production Roma development Average weekly sales gas rate (TJ/d) 80 60 40 20 0 Aug-17 Dec-17 Apr-18 Aug-18 Sales Field capacity Production + Roma production…
Roma East development well-progressed Roma East well lease Trunk line Roma nodal compressor station Coiled tubing drilling rig Santos 2018 Investor Day 53
Fairview GLNGs world-class asset Focus on well availability Fairview production Fairview development Average weekly sales gas rate (TJ/d) 600 400 200 0 Aug-17 Dec-17 Apr-18 Aug-18 Sales Field capacity Production +…
Scotia execution excellence Disciplined execution Scotia Production Scotia Development Average weekly sales gas rate (TJ/d) 60 40 20 0 Aug-17 Dec-17 Apr-18 Aug-18 Sales Field capacity Production + Disciplined execution and…
Scotia CF1 project delivered ahead of schedule and under budget Scotia production facility - before Scotia production facility - after 28 TJ/d 55 TJ/d and growing Santos 2018 Investor Day 56
Arcadia Our latest development Arcadia Phase 1 development sanctioned May 2018 Arcadia Arcadia development Average weekly sales gas rate (TJ/d) 10 8 6 4 2 0 Aug-17 Oct-17 Dec-17 Feb-18 Apr-18 Jun-18 Aug-18 Sales Field capacity…
Eastern Queensland Eastern Queensland portfolio to capture domestic gas opportunities while maintaining gas supply to GLNG + Continued focus on a disciplined low cost operating model + Realising value from previously marginal project…
GLNG summary Proven cost performance allows higher activity and future growth Lowest cost onshore Develop and appraise Explore and grow operations + Free cash flow positive at + Equity gas production growing + Develop new plays…
Conventional Oil & Gas Bruce Clement Executive Vice President Conventional Oil & Gas
Papua New Guinea Strong acreage position in highly prospective region. Santos strategy is to build partner alignment and participate in expansion opportunities at PNG LNG PNG LNG + Continued optimisation of the facilities has resulted in…
PNG growth through expansion PNG LNG expansion and upstream opportunities being progressed Upstream opportunities + Pnyang farm-in proposal received and under negotiation + Potential Pnyang development could utilise existing PNG LNG…
Northern Australia Bayu Undan infill well project underway and Barossa enters FEED Excellent DLNG plant performance and progress with Bayu Undan infill project + Darwin LNG plant performance continues to be excellent, with gross…
Northern Australia Barossa Project (Santos 25%) Barossa to be developed using subsea wells tied back to an FPSO for gas processing and condensate export. 260 km export pipeline to transport gas to existing Bayu Undan pipeline Gas FPSO…
Western Australia Low-cost, high margin conventional domestic gas assets generating strong free cash flow Strong operating performance + Collaborative joint-venture engagement has resulted in greater efficiencies, higher production and…
Conventional Oil and Gas assets delivering growth Rebalancing the portfolio to high margin conventional production Conventional assets production growth to 2025 Santos operated assets 70 mmboe + Targeting 170% growth in three core…
Operations Vince Santostefano COO Operations
Operational excellence Safer, better, cheaper Annual Improvement Plans Disciplined Process Cost Control Safety Operations Excellence Operated Value Protect Area Reset Demand Management Santos 2018 Investor Day 68
Process safety Process safety is integral to our journey to be the safest onshore operator in Australia Major process loss of containment Loss of containment categorisation Count Count 12 40 12 36 + Major process loss of containment…
Value protect Actively managing the integrity and value of our facilities + We are continuing to invest in activities that create a safe and resilient operation + Shut down activity has included Cooper Train 7, 2 LRPs and GLNG…
Cooper production costs Disciplined focus on continuous cost efficiencies Total production costs + On track to deliver 20 million (10%) reduction in million gross /boe production cost over 2017 actual 500 20 + Demonstrated step-change…
Curtis Island performance Disciplined focus on continuous cost efficiencies + Disciplined focus on continuous improvement and lean operations + 10% improvement in conversion costs in 2018 on historical performance + GLNG costs…
Operated area reset Operational Excellence framework in place to deliver best in class levels of performance + Continuing to reduce production cost in a systematic way by eliminating waste and inefficiency + Setting standards and…
Operational excellence Safer, better, cheaper Annual Improvement Plans Disciplined Process Cost Control Safety Operations Excellence Operated Value Protect Area Reset Demand Management Santos 2018 Investor Day 74
Exploration and New Ventures Bill Ovenden Executive Vice President Exploration & New Ventures
Papua New Guinea exploration and appraisal PNG LNG upstream growth alignment with key partners in the western foldbelt; new eastern foldbelt exploration presence Western Foldbelt acreage alignment (Santos 20%) + Joint-venture…
Onshore Northern Australia McArthur Basin Deliverability test of multi-TCF McArthur shale gas play. Target Northern Australian and East Coast export and domestic market opportunities + Largest and most promising shale gas opportunity…
Onshore Northern Australia Amadeus Basin Conventional sub-salt play with material running room Southern Amadeus + Wildcat test of regional sub-salt play: multi-TCF potential + Proven hydrocarbon system (Mt Kitty 1, Magee 1) +…
Offshore Northern Australia exploration Emerging NT domestic gas and LNG ullage markets. Oil upside potential Discovering new resources to complement potential new production hubs Dili + Consolidation of operated exploration…
Western Australia Consolidated domestic gas operatorship, new oil and running room Santos Evaluation + 2018 high value inventory build in the Carnarvon underpin 2019, 2020 NFE drill programme targeting Varanus Island and Devil Creek…
Cooper growth escalation Leverage experienced, low cost operatorship to exploit deep resource opportunity inventory + Ongoing build of a deep inventory of wildcat, NFE and high-impact appraisal opportunities + Discover new…
2019 Exploration and appraisal program summary PAPUA NEW GUINEA MURUK-2 APP KAROMA-1 LLI GREATER JUHA 2D SEIS KALANGAR 2D SEIS NORTHERN AUSTRALIA LLI BEEHIVE-1 MCARTHUR BASIN 2D SEIS T-1 DFIT CAMPAIGN EXP VELKERRI HZ WELLS…
Wrap-up Kevin Gallagher Managing Director & CEO
Targeting portfolio production 100 mmboe by 2025 Disciplined growth from new upstream projects leveraging-off existing infrastructure Diversified and disciplined production growth to 2025 Santos operated assets 100 mmboe Diversified…
Loading...
