Santos Limited · ASX:STO
Santos — FY2010 Earnings Presentation
18 slides from Santos's earnings presentation, Feb 17, 2011
Slide 1: 2010 Full-year Results
GLNG FID ceremony, January 2011 GLNG FID signing ceremony, 13 January 2011 L to R: Mike Sangster (Total), Heung Bog Lee (KOGAS), David Knox, Datuk Anuar Ahmad (PETRONAS) 2010 Full-year Results 17 February 2011 Disclaimer & Important Notice This presentation contains forward looking statements that a
Slide 2: Underlying net profit up 46%
2010 Full-year Results David Knox Managing Director & CEO Underlying net profit up 46% 2010 Full-year Result Change on 2009 Production 49 9 mmboe 49.9 (8%) Sales Revenue $2,228 million 2% EBITDAX $1,672 million 5% Net Profit After Tax $500 million 15% Underlying Net Profit $376 million 46% Operating
Slide 3: The Santos strategy
The Santos strategy Using quality assets, Santos will safely deliver: Base business Eastern Australia: Margin growth and resource conversion Indonesia: Established business with incremental growth WA: Growing a material domestic gas business LNG growth GLNG: FID Jan-2011, first LNG productio
Slide 4: Safety performance
Safety performance Santos TRCFR performance (Employees & Contractors) 7 6 5 TRCFR 4 3.3 3 2 1 0 2006 2007 2008 2009 2010 7 Transforming to oil-linked pricing 70% of 1.4bn boe 2P reserves Asset base is transformed exposed to oil prices through sanctioned projects Cooper to GLNG Production (mmboe) 80
Slide 5: Reported & underlying profits
2010 Full-year Results Andrew Seaton CFO Reported & underlying profits Reported NPAT Underlying NPAT $m 500 500 434 163 (39) 400 (5) 376 300 257 200 100 0 2009 2010 2009 Prices & Wet Operating 2010 foreign weather result exchange impact 10 5
Slide 6: Production impacted by flooding
Production impacted by flooding Production in line with Production guidance mmboe 60 Total wet weather and 54.4 (2.9) (2.1) 2.0 (1.5) 49.9 flood impact on Cooper 50 Basin was 2.9 mmboe 40 Stronger gas 30 production in WA and Indonesia 20 Mereenie ((NT)) gas g 10 sales contract expired 0 end-
Slide 7: Production cost and cost of sales
Production cost and cost of sales Production costs Total cost of sales $m $m 600 1600 $532 $532m $537m $24 70 $24.70 $23.67 per boe 500 per boe $9.78 $10.77 1400 Gas Purchases / boe / boe 400 300 1200 Cost of produced 200 hydrocarbons1 1000 100 0 800 2009 2010 2009 2010 1 Includes production costs,
Slide 8: $7.8 billion of funding capacity
DD&A declines by $17 million Lower depletion primarily Volume Rate due to lower production $m volumes 612 (36) 19 595 700 Partially offset by impact of higher rates 600 2011 guidance $12/boe 500 400 300 200 100 0 2009 2010 $11.25/boe $11.94/boe 15 $7.8 billion of funding capacity Comprehensive
Slide 9: Reserves growth and resource conversion
Reserves growth and resource conversion Revisions & Acq/ q/ mmboe Divest Expl Acq mmboe Prod Revisions Dives 2498 (130) (110) (5) 8 2261 1440 (50) 35 130 (110) 1445 3000 2000 Commercialisation Commercialisation 2500 1500 2000 1500 1000 To cash To cash 1000 500 500 0 0 2009 2010 2009 2010 Contingent
Slide 10: Base production grows to record levels
2010 Full-year Results David Knox Managing Director & CEO Base production grows to record levels Four projects in the base commence production in 2011 Project Santos Gross First Production (mmboe) interest production production 70 capacity Reindeer/ 45% 215 TJ/d1 2H 2011 60 Devil Creek WA 50 Spar 45
Slide 11: Reindeer/Devil Creek, WA
Reindeer/Devil Creek, WA Reindeer/Devil Creek – WA’s new domestic gas hub Project Reindeer/Devil Creek Location Carnarvon Basin, offshore ff WA Santos interest 45% Partner Apache 55%, operator Project scope Unmanned, minimum facility wellhead platform Reindeer jacket ready for installation 105-k
Slide 12: Chim Sáo, Vietnam
Chim Sáo, Vietnam Chim Sao – New oil production for Santos Project Chim Sáo Location Block 12W, offshore Vietnam S Santos i interest 31 875% 31.875% Partners Premier 53.125%, operator PetroVietnam 15% Project scope Unmanned, minimum facility wellhead platform Liquids processing and export via FP
Slide 13: Strategy delivers material LNG growth
LNG is a key component of Santos’ growth strategy Strategy Bonaparte LNG Components 2 mtpa FLNG PNG LNG Santos 40% with carry to FID Sanctioned Dec 2009 6.6 mtpa two trains Deliver the First LNG due 2014 Darwin LNG Base Business Production since 2006 Santos 13.5% 3.6 mtpa single trai
Slide 14: GLNG
GLNG 7.8 mtpa 2-train GLNG project sanctioned January 2011 FID 13 Jan 2011 7.8 mtpa, p , two trains Santos 30% Binding LNG off-take agreements with PETRONAS & KOGAS for 7mtpa in aggregate Major EPC contracts awarded to Fluor, Saipem and Bechtel Orders placed for long lead items Capital
Slide 15: GLNG 2P reserves for two trains
GLNG 2P reserves for two trains 2P Reserves (PJ) 5,009 2P CSG reserves at 10,000 Actual Projected Dec-101 - NSAI estimated higher 2P 8,000 reserves of 5,377 PJ as at end Oct-101 6,000 In addition to CSG reserves, Santos to supply 750 PJ of 4,000 portfolio gas, primarily from the Cooper Basin 2,0
Slide 16: Summary
Summary Continued delivery of Santos’ growth strategy Sound operating performance despite Central Australia flooding FID on 7.8 mtpa 2-train GLNG delivered in January PNG LNG construction ramping-up Four projects in the base business commence production in 2011 Strong financial position to
Slide 17: Significant items (after tax)
Significant items (after tax) $m 2010 2009 Underlying y g profit p 376 257 Significant items 124 177 Net profit after tax 500 434 Significant items included: Net gains on asset sales 214 180 Impairment of non-current assets (101) (17) Impairment of receivables (22) - Provision of contract losses: ri
Slide 18: 2011 Sensitivities
2011 Sensitivities Sensitivity Change NPAT Impact A$m US dollar oil price US$1/bbl 9 Gas price 10 cent/GJ 17 A$/US$ exchange rate 1 cent 8 35 Contact information Head office Andrew Nairn Adelaide Group Executive Investor Relations Ground Floor, Santos Centre Level 10, Santos Centre 60 Flinders Stree