Santos announces net profit increase of $3.1 billion

Santos plant in Cooper Basin at sunset (AER)
Santos plant in the Cooper Basin

Oil and gas giant Santos has announced its full-year results for 2022, reporting record free cash flow of US$3.6 billion and underlying profit of US$2.5 billion.

The results reflect significantly higher oil and LNG prices compared to the corresponding period due to stronger global energy demand combined with a higher interest in PNG LNG following the Oil Search merger.

Related article: Santos faces new delay on Narrabri gas project

Santos CEO Kevin Gallagher said Santos delivered record production, free cash flow and underlying earnings in 2022 as the company benefited from strong customer demand for its products, higher commodity prices and disciplined cost management.

“Today’s results demonstrate the strength of Santos, with strong diversified cashflows and capacity to provide sustainable shareholder returns, fund new developments and the transition to a lower carbon future,” he said.

“Strong free cash flows mean we are in a position to deliver higher shareholder returns through an increase in the final dividend and previously announced increase in the on-market buyback, consistent with our disciplined capital management framework.

“Demand for our products has remained strong in both Australia and internationally, due to increased demand and shortages of supply from producing nations because of global underinvestment in new supply sources.”

The announcement comes just days after the government greenlit Santos’ gas expansion project in Queensland’s Surat Basin, which will see 116 new gas wells constructed and operational until 2077. The approval has drawn criticism from both sides of politics as well as environmental groups.

Related article: Santos denies fault over dead dolphins near oil spill

The Climate Council head of advocacy Dr Jennifer Rayner said, “Santos is high up the list of our so-called ‘Dirty Dozen’ major polluters in Australia. Santos is poisoning our waterways and forests while at the same time planning to expand its operations and working hard to try to convince government and the community that its products are ‘clean’. What a joke.

“These companies have had a free pass to pollute for far too long. One very practical way to force them to cut their emissions is ensuring they can’t just buy their way out of taking responsibility with carbon credits. That’s why getting the Safeguard Mechanism right is so important: it has to drive companies to genuinely cut their emissions and ensure they pull their weight in tackling the climate crisis.”

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