Australian oil and gas explorer Santos on February 18 reported a net loss of US$357mn during the 12 months to December 31 thanks to lower oil prices. It had recorded a net profit of US$674mn in the previous year.  

“The reported net loss after tax of US$357mn includes the previously announced impairments, primarily due to lower oil price assumptions,” it said. Despite the net loss, the company delivered an underlying profit, which removes one-time charges, of US$287mn, down 60% year/year. 

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Santos CEO Kevin Gallagher said that 2021 is expected to see an improvement in performance. “As prices and demand recover, our projects are much better placed than those of our competitor countries,” he said. “Living by our disciplined approach to cost and capital allocation, and remaining cash flow positive through 2020 means we are well-positioned for further efficiency gains and growth initiatives in 2021.” 

Gallagher said that the Barossa LNG project remains on track for a final investment decision (FID) in the first half of this year. Santos in December signed a binding long-term LNG supply and purchase agreement with Japan's Mitsubishi Corp for the supply of LNG from the Barossa project. The company called it another “significant" step towards an FID on Barossa.

Gallagher further stated that progress has been made on the Dorado project off Western Australia and the company aims to take a Feed-entry decision in the first half of 2021 while also advancing plans to drill the Apus and Pavo prospects in 2021-22. 

On the Narrabri coalbed methane project in New South Wales, Gallagher said that planning is underway for the two-year appraisal programme starting later this year. Australian federal government approved the Narrabri project late last year. “Narrabri has the potential to supply up to half of New South Wales’s natural gas demand,” he said.