Australia's Santos reports 42% decline in 2023 profits

Australian energy company Santos on February 21 reported a 42% year/year decline in underlying profit for 2023, attributed to lower commodity prices.

The underlying profit, which excludes one-off items, was $1.42bn in 2023, compared with $2.46bn in 2022. Net profit also saw a decline from $2.1bn in 2022 to $1.41bn last year.

The decrease in profits is associated with a 20% year/year decline in the average realised oil price, reaching $87.6/barrel, and an 18% year/year drop in the average realised LNG price, which was $12.7/mmBtu. The company's sales revenue for the year totaled $5.9bn, down 24% compared with the previous year.

Santos said its Barossa gas project is now 67.4% complete. It has restarted drilling activities at the Barossa gas project following the approval of the revised drilling and completions environment plan.

The federal court recently discharged the injunction preventing pipelaying along part of the Barossa gas export pipeline. The company said that one-third of the pipeline has been successfully installed to date.

The Barossa gas project, operated by Santos, is a significant offshore gas and condensate initiative designed to provide a fresh source of gas to the existing 3.7mn tonnes/year Darwin LNG facility in the Northern Territory. The $3.6bn investment programme got underway with the project's final investment decision last March 2021, with the first gas due in 2025.