Santos has released its 2014 first half shareholder update, noting financial and operating highlights across its LNG projects.
Addressing its shareholders, Chairman Ken Borda and Managing Director David Knox (see above), released the following statement:
“Santos’ first-half result reinforces your company’s position as a leading oil and gas exploration and production company in Australia and Asia.
“Successful project delivery continued during the half, with the start-up of PNG LNG ahead of schedule in April 2014. With GLNG now more than 85% complete and on track for first cargo in 2015, our portfolio of assets is being transformed. LNG’s attractiveness as a cleaner burning fuel continues to create opportunities in the fast growing Asian region, and Santos is well placed to benefit.
“Sound operational performance resulted in a higher first-half underlying profit, strong operating cash flow and record sales revenue driven by higher crude oil and LNG sales volumes and higher oil and gas prices.
“Our ongoing commitment to exploration resulted in a significant gas-condensate discovery at the Lasseter-1 exploration well in the Browse Basin offshore Western Australia. Lasseter is a material discovery that adds to our strong position in the Browse, following our success with the Crown discovery in 2012.
“Our ability to continue to deliver this strong operational and financial performance is dependent on our execution of safe operations. Santos and its contractors worked a record 32 million work hours in the first half and we are attaining the lowest levels of lost time incidents in the company’s history.
Shares and dividends
“The Santos Board and management are aware that returns are a key priority for shareholders. Our aim is to strike an ongoing balance between higher dividends, debt repayment and ongoing investment for growth. Following the early start-up of PNG LNG and the receipt of first cash from the project, the Board announced an interim dividend of 20 cents per share fully franked, 33% higher than the previous interim dividend.
“Looking forward, we plan to maintain or increase each dividend as earnings and cash flow increase. We expect the level of dividend will next be reviewed around the time of GLNG start-up.
“Our major projects are now clearly providing the foundation for future growth and increased shareholder returns and we remain well-funded to execute our strategy with AU$ 2.7 billion in cash and undrawn debt facilities. A strong production outlook driven by the start-up of PNG LNG in 2014 and GLNG in 2015 combined with growing oil-linked margins is set to drive continued revenue growth.
“Thank you for your support. We are confident of a stronger second half and look forward to continuing to deliver on our strategy to grow shareholder value in a safe and sustainable manner.”
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/30092014/santos-shareholder-update-1505/