Introduction
Santos, a leading energy company, has reported a significant decline in revenue for the second quarter of the year. The decrease can be attributed to lower sales volumes of liquefied natural gas (LNG) and a decrease in energy prices.
Revenue Decline
In the three months through June, Santos experienced a decline in revenue of 18% compared to the previous quarter. Quarterly sales revenue dropped from US$1.63 billion to US$1.34 billion. Despite this decrease, the company saw a 3% increase in oil and gas production, reaching 22.8 million barrels of oil equivalent.
Strong Underlying Business
Even in the midst of a volatile oil price environment, Santos maintains a strong underlying business. Chief Executive Kevin Gallagher emphasized this strength, stating, “Our underlying business remains strong and has continued to perform well.” The company generated over US$1.1 billion in free cash flow during the first half of the year, positioning itself to deliver shareholder returns while investing in decarbonization projects.
Free Cash Flow
Santos reported approximately US$400 million in free cash flow for the second quarter. This financial strength will enable the company to sustain its existing business operations and invest in future growth opportunities.
Bayu-Undan Gas Field
Santos has also provided an update on the Bayu-Undan natural-gas field located offshore northern Australia. The field is expected to reach the end of its life in the second half of this year.
As Santos faces challenges in the market, the company remains confident in its ability to navigate these obstacles and continue its success as a leading player in the energy sector.
