2006 full year results roadshow presentation · this presentation contains forward looking...
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1.
2006 Full Year Results2006 Full Year ResultsRoadshow PresentationRoadshow Presentation
22 February 200722 February 2007
2.
A$6.41/bbl 3%Reported A$643m 16%
Sales Revenue$2,769m 12%
0500
1000150020002500
2004 2005 2006
$2,144m 17%
0
1000
2000
3000
2004 2005 2006
Strong Operating PerformanceStrong Operating Performance
0
20
40
60
80
2004 2005 2006
0
200
400
600
800
2004 2005 2006
Production
2P ReservesProduction Costs/bblNPAT
EBITDAX
6
6.2
6.4
6.6
6.8
2004 2005 2006
0200400600800
1000
2004 2005 2006
61.0 mmboe 9%
mm
boe
mm
boe
A$m
A$m
A$/b
blA$
m
819 mmboe 6%
6.0
Underlying A$683m 7%
3.
Banjar Panji IncidentBanjar Panji Incident
• Santos 18% non-operated interest
• Mud flow commenced May 2006
• Response effort managed by a
National Mitigation Team
• Financial impact remains uncertain
4.
14% Increase in Contingent Resources14% Increase in Contingent Resources
Over 2.2 billion Over 2.2 billion boeboe of contingent resourceof contingent resource
Australia OnshoreAustralia Onshore733 mmboe733 mmboe
• Evans Shoal• Caldita/Barossa• Petrel/Tern• Reindeer
PNGPNG363 mmboe363 mmboe
• Hides• Barikewa• Elevala
AsiaAsia117 mmboe117 mmboe
• Hiu Aman• Wortel• Blackbird/ Dua• Swan
• Fairview• Roma
Australia OffshoreAustralia Offshore1,025 mmboe1,025 mmboe
5.
A Portfolio of Growth BusinessesA Portfolio of Growth Businesses
2.2. Eastern Australian gasEastern Australian gas
1.1. Cooper Basin oilCooper Basin oil
3.3. Western Australian oil and gasWestern Australian oil and gas
5.5. Asian growthAsian growth
4.4. LNG projectsLNG projects
6.
Santos competitive advantageSantos competitive advantage
Cooper Basin OilCooper Basin Oil
High value opportunityHigh value opportunity
Oil prices higher for longer
Ability to execute low cost program
Over 700 mmbbl original oil in place
Positive 2006 results
Utilising modern rigs and proven technology to increase recovery factors
Largest onshore Australian oil acreage position: 27,000km2
Doubling program in 2007
Unique capabilities, knowledge, infrastructure and short cycle time
7.
2006 2006 PlanPlan
20072007TargetTarget
2006 results above expectations
% % ChangeChange
Cooper Basin Oil Cooper Basin Oil –– 2006 Results2006 Results
Wells 100 108 8% 190
Success Rate 75% 79% 4% 75%
2P Reserves added (mmbbl) 7 15 114% 17
Initial rate per well (bbl/d) 120 156 30% 160
Capex $170m $186m 9% $330m
Full-cycle F&D Cost (A$/bbl) 18 22 22% 22
2006 Actual2006 Actual
8.
Significant near and medium term production impactSignificant near and medium term production impact
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
Actual Projected
Bar
rels
per
day
(S
anto
s sh
are)
Base
Cooper Basin Oil Cooper Basin Oil –– Production OutlookProduction Outlook
2004 2005 2006 2007 2008 2009 2010
9.
Eastern Australian GasEastern Australian Gas
Gas demand growing strongly, PNG gas project suspended
Largest acreage operator in Otway/Sorell Basins
Otway Basin now a major gas producing area
CSG emerging to fill market demand
Gas is a low carbon emission fuel
Established leading position in CSG
Large uncontracted gas position, demonstrated contracting capability
Increasing gas demand and price
Strong market growthStrong market growth Santos is well positionedSantos is well positioned
10.
Significant uncontracted demand to place SantosSignificant uncontracted demand to place Santos’’ 1P, 2P & 3P reserves1P, 2P & 3P reserves
EA Gas EA Gas –– Supply and DemandSupply and Demand
0
200
400
600
800
1,000
1,200
1,400
2006 2008 2010 2012 2014 2016 2018 2020 2022 2024
*Wood MacKenzie – Eastern Australia Gas & Power Outlook to 2025 Fitting the pieces together
Total Market Demand*
Santos Contracted Share
Remaining Uncontracted 1P - Santos Share
Remaining Uncontracted 2P - Santos Share
Remaining Uncontracted 3P - Santos Share
PJ/
a
Total Contracted Market
11.
0 100
kilometres• Strong competitive advantages
- Highest quality acreage
- Industry leading capability
- Existing infrastructure
- Largest onshore operator
Material CSG legacy asset establishedMaterial CSG legacy asset established
EA Gas EA Gas –– CSG BusinessCSG Business
LegendSantos acreageExtent of Surat/Bowen BasinsSantos CSG projectsOther producing CSG projectsGas pipeline
Oil pipeline
LegendSantos acreageExtent of Surat/Bowen BasinsSantos CSG projectsOther producing CSG projectsGas pipeline
Oil pipeline
Moranbah
EmeraldBowen
Basin
MahaloMouraDawson ValleyMungiQld
FairviewSpring Gully
Roma Shallow Gas (CSG)
Surat Basin
NSW
Roma
TardrumScotia/Peat
Moonie
Toowoomba
Kogan Nth
BrisbaneBrisbane
MaryboroughMaryborough
BundabergBundaberg
GladstoneGladstoneRockhamptonRockhampton
ScotiaScotia
FairviewFairview
RomaRoma
12.
0
50
100
150
200
2006 2007 2008 2009 2010 2011 2012
TJ/d
ay
Scotia Fairview
• Integrated Fairview acquisition
• Added 380 PJ of 2P reserves
• Finding cost of 7c/GJ
• Drilled 40 wells
• Capex A$124 million
• Installed Fairview to Wallumbilla pipeline
65% increase in CSG production in 200665% increase in CSG production in 2006CSG Sales (Santos share)CSG Sales (Santos share)
EA Gas EA Gas –– CSG GrowthCSG Growth
13.
Western Australian Oil and GasWestern Australian Oil and Gas
Oil upside, gas prices risingOil upside, gas prices rising Santos well positionedSantos well positioned
Global gas prices rising
Reindeer development opportunity
Further growth expected at higher prices
Demand for gas remains high
Uncontracted John Brookes reserves
WA gas market has moved to $5+ per GJ
Proven hydrocarbon systems
Multiple oil exploration and appraisal targets, short cycle time opportunities
14.
WA Oil & Gas WA Oil & Gas –– GasGas Production OutlookProduction Outlook
Production increasing into higher price environmentProduction increasing into higher price environment
• John Brookes ramp-up- 200 PJ uncontracted 2P
reserve
• Reindeer follow up opportunity- 300 ̶ 500 PJ resource
- Feasibility study underway
- First production target 2010 0
20
40
60
80
100
120
2003 2004 2005 2006 2007 2008 2009 2010
TJ/d
ay S
ales
15.
WA Oil & Gas WA Oil & Gas –– Exploration & AppraisalExploration & Appraisal
Short cycle time, near field oil opportunities Short cycle time, near field oil opportunities
• Carnarvon Basin 2007 wells- Fletcher
- Totem
- Hurricane appraisal
- Mutineer appraisalWesternAustralia
WesternAustralia
100km100km100km100km
ReindeerReindeer
Fletcher
Hurricane
MutineerExeter
John BrookesJohn Brookes
LegendSantos Acreage Oil FieldGas Pipeline Gas FieldExploration WellAppraisal Well
LegendSantos Acreage Oil FieldGas Pipeline Gas FieldExploration WellAppraisal Well
Barrow IslandBarrow Island
Thevenard IslandThevenard Island
LegendreTotem
16.
Santos well positionedSantos well positionedFavourable LNG dynamicsFavourable LNG dynamics
Booming demand for LNG
Hides field critical to PNG LNGPNG LNG
Large gas resources a prerequisite
Darwin LNG expansion
Significant contingent resource positions with quality assets
Multiple LNG opportunities
Santos 40% interest in 8+ tcf of resources
LNG ProjectsLNG Projects
17.
• ExxonMobil progressing evaluation of LNG development including Hides field- 5 to 6.5 mtpa LNG plant
- First cargos target 2012-2013
- Santos share 6+ mmboe pa
• Other Santos resources- 43% and operator of Barikewa
- 50% and operator of Elevala
• In total – 363 mmboe contingent resource in PNG
LNG the focus for PNG gas resourcesLNG the focus for PNG gas resources
LNG Projects LNG Projects -- PNGPNG
PRL 9
PDL 3
Papua New GuineaPDL 1PRL 5
SE Gobe
Barikewa
LegendSantos AcreageOil FieldGas FieldOil Pipeline
LegendSantos AcreageOil FieldGas FieldOil Pipeline
Hides
Elevala
MarineTerminal
ProposedLNG Facility
18.
• Material acreage position
• Appraisal ongoing
• 8+ tcf resource
• Aligned with ConocoPhillips
• 3.5 to 6 mtpa train
• First cargos 2013+
Santos well positioned for Darwin second trainSantos well positioned for Darwin second train
LNG Projects LNG Projects -- DarwinDarwin
00 100100
KilometresKilometres
LegendSantos Acreage Gas FieldGas Pipeline
LegendSantos Acreage Gas FieldGas Pipeline
DarwinDarwin
SunriseSunriseAbadiAbadi
CalditaCalditaEvans ShoalEvans Shoal
BarossaBarossa
PetrelPetrel
TernTern
Santos (Op) 40%Shell 50%Osaka Gas 10%
Santos 40%ConocoPhillips (Op) 60%
DLNG1Santos 10.6%ConocoPhillips (Op) 56.7%
19.
Asian GrowthAsian Growth
Santos has a quality portfolioSantos has a quality portfolioHigh growth potentialHigh growth potential
Focussed, long termvision required for success
Blackbird, Dua oil discoveries, Swan gas field, active exploration program
2006 new country entry to Vietnam
Development, production and exploration in Indonesia
Quality acreage captured
Maleo gas project online, Oyong startup 2Q 2007, Kutei
Strategy focus on Asia, USA business for sale
Indian entry, Kyrgyzstan acreage extension, Vietnam new block
20.
Two oil discoveries, with follow-on opportunitiesTwo oil discoveries, with followTwo oil discoveries, with follow--on opportunitieson opportunities
• Blackbird and Dua oil discoveries
• Accelerating seismic into Q1 2007, drilling into Q4 2007
• Commencing development planning
• Swan gas field development potential
• Northern block secured
25km
Blackbird oil discovery
LegendSantos acreage Gas fieldOil Field Gas Pipeline
Dua oil discoveryDuaDua oil discoveryoil discovery
Asian Growth Asian Growth -- VietnamVietnam
Swan gas fieldSwan gas field
12 PSC
21.
Core business positioned for growthCore business positioned for growthCore business positioned for growth
• Oyong Q2 2007 start-up
• Wortel gas discovery- Development planning
underway
• Jeruk development studies ongoing
• Kutei Basin- Exploration/appraisal wells
subject to deep water rig availability
0 250
kilometres
East JavaBasin
East JavaBasin
KuteiBasinKuteiBasin
Wortel
Kalimantan
East Java
Asian Growth Asian Growth -- IndonesiaIndonesia
Oyong
Maleo
LegendSantos acreage Oil pipeline Oil field Gas pipelineGas field
22.
• Attractive frontier basin
• Work program- 1 exploration well
- 2D and 3D seismic
- Estimated cost A$90m
• Emerging market with sound energy fundamentals
High potential regionHigh potential regionHigh potential region
0 100
kilometres
Ganges-BrahmaputraDelta
Ganges-BrahmaputraDelta
Kolkata
India Bangladesh
India
LegendSantos AcreageGas Field
LegendSantos AcreageGas Field
Burma
Asian Growth Asian Growth -- IndiaIndia
23.
Production OutlookProduction Outlook
Actual Outlook
Production guidance Production guidance –– 59 to 61 59 to 61 mmboemmboe in 2007 and 2008in 2007 and 2008
0
10
20
30
4050
60
70
80
90
100
2005 2007 2009 2011 2013 2015 2017 2019
EA Gas Cooper Oil WA O&G International LNG Exploration
24.
SummarySummary
2. Eastern Australian gas
1. Cooper Basin oil
3. Western Australian oil and gas
5. Asian growth
4. LNG projects
• CSG new legacy asset• Flexibility through hub strategy• Positioned for increasing demand
• Large scale, low risk opportunity• Unique competitive advantage• Acreage and infrastructure
• Increasing gas production into higher price environment
• Near field exploration and appraisal
• Darwin LNG expansion• PNG LNG using Hides gas
• Regional expansion focus
25.
Reference SlidesReference Slides
26.
Cooper Basin Oil 2006 ProgramCooper Basin Oil 2006 Program
108 wells drilled with 79% success rate108 wells drilled with 79% success rate
SouthAustralia
Queensland
Oil PipelineGas Pipeline
Oil PipelineGas Pipeline
LegendSantos AcreageOil FieldGas Field
LegendSantos AcreageOil FieldGas Field
Rest of QldWells drilled 16Yanda 11Challum 3Wackett 1Currambar 1
Success 94%
ATP299PWells drilled 76
Success 75%
SAWells drilled 16JALBU 11 PEL114 3Derrilyn 2
Success 81%
MoombaMoomba
BalleraBalleraJacksonJackson
27.
Cooper Basin Oil 2007 PlanCooper Basin Oil 2007 Plan
~ 190 wells planned~ 190 wells planned
SouthAustralia
Queensland
Jackson / NaccowlahJackson / Naccowlah45 45 -- 50 wells to drill50 wells to drill
ATP 299ATP 29965 65 -- 75 wells75 wellsto drillto drill
Oil PipelineGas Pipeline
Oil PipelineGas Pipeline
LegendSantos AcreageOil FieldGas Field
LegendSantos AcreageOil FieldGas Field
Greater SAGreater SA25 25 -- 30 wells 30 wells to drillto drill
JALBU / PEL 114JALBU / PEL 11445 45 -- 55 wells to drill55 wells to drill
MoombaMoomba
BalleraBalleraJacksonJackson
28.
Cooper Basin Oil Cooper Basin Oil -- WaterfloodingWaterflooding
• Without pressure support, an oil reservoir can have recovery factors less than 10% of oil-in-place
• Injection of water into the reservoir provides pressure support (drive) and “sweeps” the oil towards the producing wells
Water injection
Oil Production
ProductionRate
Time
Waterflood, pressuresupport
No pressuresupport, naturalfield decline
29.
Q1 0750OilEgyptRAD 2X
Q4 0737.5OilVietnamFalcon
Q4 07100OilEgyptSEJ-1
Q4 0733OilHoutmanCharon
Q3 0740.5Oil/GasEast JavaEJ-1
Q2 07 22.6OilDampierCharm-1
Q2/Q3 0733.3OilDampierFletcher-1
Q2 0766GasCooperMontegue
Q2 07 33.3OilDampierTotem-1
Q2 0731.3OilDampierHurricane-2
Q1 0750OilSurat/BowenStitch
Q1 0753.8OilSurat/BowenMahogany
%100 - 25050 -1000 – 50
TimingSantos InterestUpside Resource Potential (mmboe)TargetBasin / AreaWell Name
2007 Forward Exploration Schedule2007 Forward Exploration Schedule
The exploration portfolio is constantly being optimised therefore the above program may vary as a result of rig availability, drilling outcomes and as new prospects mature
30.
Project StatusProject Status
Project Oil/Gas EstimatedCapex A$m
StatusInitial Production
Cooper Oil Oil ongoing 1,000 In production(1000 well plan)
CSG (6 year plan) Gas ongoing 700 In production
Oyong Phase 1 Oil Q2 2007 49 Development
Oyong Phase 2 Gas 2H 2008 37 Development
Henry Gas 2009 140 FEED
Kipper Gas 2010 300 FEED
Amulet Oil 2010 TBC Appraisal
Dua/Blackbird Oil 2010-11 TBC Appraisal
Reindeer Gas 2010 TBC Feasibility
PNG LNG LNG 2012-2013 TBC Feasibility
Timor/Bonaparte LNG LNG 2013+ TBC Appraisal
31.
Disclaimer & Important NoticeDisclaimer & Important Notice
This presentation contains forward looking statements that are sThis presentation contains forward looking statements that are subject to ubject to risk factors associated with the oil and gas industry. It is belrisk factors associated with the oil and gas industry. It is believed that the ieved that the expectations reflected in these statements are reasonable, but texpectations reflected in these statements are reasonable, but they may hey may be affected by a range of variables which could cause actual resbe affected by a range of variables which could cause actual results or ults or trends to differ materially, including but not limited to: pricetrends to differ materially, including but not limited to: price fluctuations, fluctuations, actual demand, currency fluctuations, geotechnical factors, drilactual demand, currency fluctuations, geotechnical factors, drilling and ling and production results, gas commercialisation, development progress,production results, gas commercialisation, development progress,operating results, engineering estimates, reserve estimates, losoperating results, engineering estimates, reserve estimates, loss of market, s of market, industry competition, environmental risks, physical risks, legisindustry competition, environmental risks, physical risks, legislative, fiscal lative, fiscal and regulatory developments, economic and financial markets condand regulatory developments, economic and financial markets conditions in itions in various countries, approvals and cost estimates.various countries, approvals and cost estimates.
All references to dollars, cents or $ in this document are to AuAll references to dollars, cents or $ in this document are to Australian stralian currency, unless otherwise stated.currency, unless otherwise stated.