Australian Santos Sees Steady Production in 2018, Lower Sales

Australian gas producer Santos expects its production volumes to be steady next year but sales volumes are due to fall, the company said November 9.

It has pegged the 2018 production guidance at 55mn-60mn barrels of oil equivalent (boe), compared with 58mn-60mn boe for 2017.

Last month, Santos lifted the bottom-end of its 2017 guidance from 57mn to 58mn boe.

“2017 production and sales volumes are expected to be towards the upper end of the 58-60mn boe and 79-82 mmboe guidance ranges, respectively. All other guidance for 2017 is maintained, including capital expenditure of $700-750mn,” Santos said November 9.

Sales volumes are expected to be pared back to 72mn-78mn boe next year, primarily owing to lower forecast third party gas sales and lower non-core asset volumes, it said. In October, Santos also lifted the bottom end of its 2017 sales guidance from 77mn boe to 79mn boe.

Capital expenditure in 2018 is expected to be in the range of $825-$875mn, it said.

“All five core assets are expected to deliver higher production in 2018, including allowing for major planned plant shutdowns at PNG LNG, Darwin LNG and Moomba,” Santos said.

“Higher production from the core assets is expected to be offset by natural field decline in the non-core assets,” it added. 

Nathan Richardson