Australia’s Santos reports lower sales revenue in Q3

Australian LNG player Santos reported a drop in its sales revenue in the third quarter of this year due to lower production and prices.

The independent LNG producer said on Thursday that its July-September sales revenue reached $1.44 billion.

This marks a drop of 33 percent compared to $2.15 billion last year, while year-to-date revenue of $4.40 billion dropped by 25 percent compared to the last year.

Compared to the prior quarter, sales revenue in the third quarter rose by 7 percent.

Third quarter production of 23.3 mmboe was lower than 26.1 mmboe in the same period last year but it rose 2 percent from 22.8 mmboe in the previous quarter.

Santos sad that Bayu-Undan continues to produce with at least one more LNG cargo expected, followed by sales into the Australian domestic market until end of field life.

51 LNG cargoes

The Australian LNG player said its average realized LNG price of $12.02 per MMBtu in the third quarter rose slightly compared to 11.96 per MMBtu in the prior quarter but it dropped from 16.76 per MMBtu in the same quarter last year.

According to Santos, average realized LNG prices were aligned with the prior quarter, with higher realized prices from Darwin LNG offsetting lower oil linked sales contracts from lagged Japan Customs-cleared Crude (JCC) prices.

Three-month lagged JCC averaged US$84/bbl in the third quarter of 2023 compared to US$87/bbl in the second quarter.

Moreover, Santos’ LNG projects shipped 51 cargoes in the third quarter, of which five were sold on a JKM-linked basis, one from Darwin LNG and four from PNG LNG.

Santos managing director and CEO, Kevin Gallagher, said that “the underlying business performance, combined with a strong focus on operational excellence, delivered yet another strong quarter.”

“Free cash flow of $1.6 billion year-to-date positions the company well to deliver shareholder returns, backfill and sustain our existing business, while also investing in our major projects and progressing our decarbonization plans,” Gallagher said.

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