3 June 2008investor presentation● Neutral
Sydney investor seminar presentation led by Acting CEO David Knox, covering strategy, base business, LNG and Asia. The readable text restates known strategy and projects; no new figures are shown.
Announcements, explained
Each one in plain English, with the numbers worked through for a shareholder.
29 May 2008farm in farm out agreement▲ GoodMajor
Santos sells PETRONAS a 40% interest in Gladstone LNG for US$2.008bn, plus US$500m on a final investment decision for a second train. Santos keeps 60% and upstream operatorship. Completion needs FIRB approval, expected within 3 months, which resolves the partner search.
29 May 2008investor presentation▲ Good
Presentation accompanying the PETRONAS deal: 40% of Gladstone LNG for up to US$2.508bn. It says Santos sells 538 PJ of CSG 2P reserves, retains about 89% of total 2P reserves, and values them at A$4.91/GJ. Repeats the announcement.
28 May 2008drilling progress report● Neutral
Third-party Beach weekly report: the only Santos-operated well in progress is Mitchie-2 (Beach 20.21%), running wireline logs at 3,097 m. Other items are Beach's own wells or non-Santos operated.
22 May 2008asset acquisition disposition● Neutral
Third-party Beach release: Beach will farm in to a 20% interest in Santos Egypt's South East July concession and buy Santos Egypt's 25% of North Qarun, subject to Egyptian approvals. It indicates Santos is reducing its Egypt holdings; no price is stated.
22 May 2008material agreement▲ GoodMajor
PNG Government signed the Gas Agreement and PNG LNG formally entered FEED, resolving the pending approval. Santos holds 17.7%; FEED runs 16 months with a final investment decision expected Q4 2009 and first LNG early 2014.
21 May 2008well test result▲ GoodMajor
Chim Sao North appraisal well in Vietnam Block 12W flowed oil from two zones, 1,650 bopd and 2,680 bopd, with no water. It will be suspended as a future producer, supporting a development decision on Chim Sao, where Santos holds 37.5%.
14 May 2008director officer appointment● Neutral
Santos finalised departing CEO John Ellice-Flint's package: 12 months' base salary, accrued entitlements, vesting of 2,312,500 options at A$11.36, and a A$520,312 pro-rata bonus. He consults until 30 June 2008.
14 May 2008drilling progress report● Neutral
Third-party Beach weekly report: Santos-operated Cook-14 is to be cased as a future Hutton oil producer, and Bindah-2 as a future Tirrawarra oil and Patchawarra gas producer. Other items are Beach's own wells.
13 May 2008other● Neutral
Third-party Icon Energy says the Santos-to-Taycol option transfer had irregularities, so the exercise was invalid. Santos still holds 20,000,000 Icon options, exercisable to 31 December 2008. Reverses the 8 May notice.
8 May 2008other● Neutral
Third-party Icon Energy notice that Santos, holder of 20,000,000 Icon options, transferred them to Taycol Nominees, which then gave notice to exercise them. Option price is a 20% discount to the 5-day average market price.
8 May 2008investor presentation● Neutral
CFO Peter Wasow's Macquarie conference presentation argues Gladstone LNG shifts Santos from domestic to global gas pricing, with production up about 70% and reserves growing about 300%. It repeats the known strategy; the readable text shows no new figures.
7 May 2008drilling progress report● Neutral
Third-party Beach weekly report: Santos-operated Coonatie-12 was cased and suspended as a future gas producer, and Bindah-2 is drilling in the Patchawarra. Other items are Beach's own wells.
6 May 2008drilling result▲ Good
Third-party Vicpet release confirms the Cuisinier-1 oil discovery in ATP 752P, with 6 m net pay, completed as a producer. Production is expected early Q3 2008 through Santos infrastructure; Hudson-1 follows in June.
6 May 2008drilling result▲ GoodMajor
Third-party Bow release: Santos-operated Cuisinier-1 was cased and suspended as a potential new oil discovery, with 6 m of net oil pay at 1,622-1,630 m. Next farm-in well, Hudson-1, is planned for late June 2008.
2 May 2008agm notice● Neutral
Chairman and Acting CEO addresses at the 2 May 2008 AGM, reviewing 2007: production 59.1 mmboe, net profit A$441m, 40c dividend, 2P reserves 879 mmboe. Restates known facts, including the share cap removal on 29 November 2008.
2 May 2008agm notice● Neutral
All five AGM resolutions passed on 2 May 2008, including electing Peter Coates and re-electing two directors, adopting the remuneration report, and lifting the non-executive director fee pool from A$1.5m to A$2.1m.
30 Apr 2008drilling progress report● Neutral
Third-party Beach weekly report: Santos-operated McKinlay-9 was cased and suspended as a future oil producer. Coonatie-12 reached 3,165 m and Bindah-2 is drilling. Bodalla South-19 is Beach's own well.
24 Apr 2008regulatory community update▼ BadMajor
Santos will not seek to reopen the Moonie to Brisbane oil pipeline, closed since a July 2007 leak in Algester, citing the expense and difficulty of proving its integrity. Its book value was already fully written off in 2007 accounts, with a decommissioning provision made.
23 Apr 2008quarterly activities report● Neutral
Q1 2008 production was 13.7 mmboe (14.0 in Q4 2007), hit by Mutineer-Exeter repairs; record Q1 revenue was A$634m, up 9% on a year earlier. 2008 guidance of 56-58 mmboe is confirmed.
23 Apr 2008drilling progress report● Neutral
Third-party Beach weekly report: Santos-operated Cooba-3 was cased as a future gas producer and Mudera-14 was suspended, to continue with another rig later. McKinlay-9 is drilling. Beach's Coolangatta-1 was abandoned.
23 Apr 2008drilling spud● Neutral
Third-party Bow release repeating that Santos-operated Cuisinier-1 spudded 21 April 2008 in ATP 752P, the first well of the farm-in. Bow is fully carried for up to 7 wells and keeps 15%. Nothing new for Santos.
23 Apr 2008drilling spud● Neutral
Third-party Vicpet release: Santos-operated Cuisinier-1 began drilling 21 April 2008 in ATP 752P, the first well of the farm-in with Vicpet, Bow and Avery. It targets up to 2.1 million barrels, to 2,513 m, about 6.2 km from the Cook field.
22 Apr 2008production update● Neutral
Third-party Entek update on ATP-269P in SW Queensland, where Santos holds 4.90%. March gross oil production was a record 2,384 barrels. The update is mainly about Entek's own wells and has little bearing on Santos.
16 Apr 2008drilling progress report● Neutral
Third-party Beach weekly report: Santos-operated McKinlay-7 and Cook-13 were successful (Cook-13 with 13 ft net oil pay), and Granchio-2 is in progress. Cooba-3 and Mudera-13 also progressed. Beach's own Currumbin-1 was abandoned.
9 Apr 2008drilling progress report● Neutral
Third-party Beach weekly report: Santos-operated Cook-10 was plugged and abandoned; Mudera-12 and Coonatie-13 were cased as gas producers. Cook-13, Cooba-3, McKinlay-7 and Mudera-13 are in progress.
9 Apr 2008drilling progress report● Neutral
Third-party Tap update: Santos-operated Johnson-1 (Santos 37.5%) reached about 1,680 m, with 10-14 more days to reach total depth near 3,200 m. No result yet.
8 Apr 2008contract award▲ GoodMajor
Santos awarded parallel six-month pre-FEED contracts to Foster Wheeler and Bechtel for Gladstone LNG, comparing two liquefaction technologies. The schedule is unchanged: FEED decision around end-2008 or early 2009, FID end-2009, first LNG early 2014.
7 Apr 2008asset acquisition disposition▲ GoodMajor
Final investment decision taken on the Reindeer gas project offshore WA (Santos 45%, Apache 55% operator). Santos' share of capital cost is A$379m; first gas is targeted end-2010, later than the earlier 2010 expectation. 2P reserves are about 485 PJ, Santos share about 220 PJ.
3 Apr 2008joint venture update● Neutral
Third-party Sunshine Gas operational update. At Crocker Gully (ATP 685P, Santos 50%), Crocker Gully 2 reached 606 m with encouraging gas desorption; the joint venture is forming a forward program. Other content concerns Sunshine's own projects.