Santos to continue cutting costs

Santos recorded a 24% drop in sales revenue in 4Q15 to $828 million compared to the corresponding quarter of 2014.

The company’s full-year capital expenditure of $1.66 billion was below guidance and 54% lower than the prior year, while full-year production costs per barrel were 10% lower.

The company’s Gladstone LNG (GLNG) train 1 produced 544 000 t of LNG during the 4Q15 and achieved daily LNG production rates more than 10% above nameplate capacity. GLNG has shipped 11 LNG cargoes to date.

In November 2015, Santos announced $3.5 billion of capital initiatives to strengthen the balance sheet and reduce debt. The company also appointed Kevin Gallagher as Managing Director and Chief Executive Officer.

In response to the challenging oil price environment, Santos Executive Chairman, Peter Coates, said that the company will continue to review its operational and development plans with a focus on preserving cash.

Mr Coates said: “Santos is well placed to withstand an extended period of low oil prices, with $4.8 billion in cash and committed undrawn debt facilities, and no material debt maturities until 2019 […] We are continuing to focus on reducing our capital expenditure and will build upon the significant improvements that we have made to our operating efficiency […] PNG LNG and Darwin LNG operated at record rates during the fourth quarter, while GLNG has ramped up as expected following first LNG in late-September.”

Edited from press release by Callum O'Reilly

Read the article online at: https://www.lngindustry.com/liquid-natural-gas/22012016/santos-to-continue-cutting-costs-1911/