Santos Limited

Santos Limited
Company type	Public
Industry	Oil and gas exploration and production
Founded	March 18, 1954; 72 years ago
Headquarters	Adelaide, Australia
Key people	Kevin Gallagher (CEO)
Products	Natural gas, liquefied natural gas (LNG), crude oil, pipeline gas
Website	www.santos.com

Santos Limited (an acronym for South Australia and Northern Territory Oil Search) is an Australian enterprise specializing in oil and gas exploration and production, with its main office located in Adelaide, South Australia. The company possesses assets spanning liquefied natural gas (LNG), pipeline gas, and crude oil sectors. As Australia's foremost supplier of natural gas, Santos operates facilities in the Cooper Basin (South Australia) and South West Queensland, catering primarily to the eastern states. Its operations extend offshore near Western Australia and the Northern Territory. According to Forbes' 2024 rankings, Santos stands as the 15th largest corporation within Australia.

The firm has attracted scrutiny concerning its greenhouse gas output, involvement in political lobbying, and incidents involving environmental contamination. Santos actively supports cultural festivals, charitable organizations, and the Australian School of Petroleum at the University of Adelaide.

History

Established on 18 March 1954, the company’s name reflects its origins: South Australia Northern Territory Oil Search. Its early development centered on natural gas discoveries in the Cooper Basin, notably wells such as Gidgealpa 2 (1963) and Moomba 1 (1966). Gas supply commenced in 1969 through agreements with major utilities in South Australia.

After discovering oil at Tirrawarra near Moomba during the early 1970s, Santos expanded into liquid hydrocarbon production by constructing a processing plant at Moomba alongside fractionation and loading facilities at Port Bonython.

Throughout the 1990s, Santos grew through acquisitions and broadened its onshore and offshore footprint across Australia as well as Indonesia, Malaysia, Vietnam, and Papua New Guinea. It also secured petroleum interests in regions including the United States, United Kingdom, Timor Sea, and Western Australia. The Ballera gas facility in South West Queensland was commissioned in 1991 and underwent enhancements in 1997.

In 2015, Santos initiated LNG production with exports directed to South Korea. The acquisition of Quadrant Energy for $2.15 billion in August 2018 enabled Santos to acquire an 80% stake in the Dorado project located within Western Australia's Bedout Basin.

May 2020 marked the completion of a $1.265 billion purchase of ConocoPhillips’ northern Australian and Timor-Leste assets by Santos. This deal included offshore Bayu-Undan fields, subsea infrastructure in the Timor Sea, as well as the Darwin LNG plant and associated pipeline. The acquisition increased Santos’s ownership to 68.4% in these assets and raised its share to 62.5% in the Barossa development following a final investment decision.

In December 2021, Santos expanded further by acquiring Oil Search, Papua New Guinea’s largest oil and gas exploration company responsible for operating all of the nation's oilfields.

Description and governance

Santos stands as a prominent Australian producer of gas and oil, distributing sales gas throughout mainland Australia, supplying ethane to Sydney, and marketing oil and liquid hydrocarbons both domestically and internationally. It holds the position of Australia's largest natural gas supplier and ranks as the second-largest independent producer of oil and natural gas nationally. By 2019, it was anticipated to be the leading global exporter of liquefied natural gas (LNG). According to Forbes Global 2000 in 2020, Santos was ranked as the world’s 1583rd-largest publicly traded company.

The corporate headquarters is situated at 60 Flinders Street, Adelaide, with additional offices located in Brisbane, Sydney, Perth, and Jakarta. Kevin Gallagher has been serving as CEO since February 2016, following David Knox’s tenure.

Operations

Santos's main natural gas reserves are situated in South Australia and Queensland, supplying the eastern states of Australia. The company serves as the principal venture partner and operator for natural gas processing plants located at Moomba (SA) and Ballera (Queensland). These facilities are connected by pipeline systems that extend to Adelaide, Sydney, Melbourne, Brisbane, Rockhampton, and Mount Isa.

Gas and LNG

Significant gas discoveries by Santos have been made in the Browse Basin, off the northwest coast of Western Australia. On 22 August 2014, the company revealed a substantial gas condensate find at the Lasseter-1 well within WA-274-P, where Santos holds a 30% stake alongside Chevron (50%) and Inpex (20%). This marked Santos's second major discovery in this region within a two-year span.

On 7 September 2017, Santos pledged to redirect 30 petajoules of gas from the Gladstone LNG facility to supply Australia's eastern market during 2018–2019. This move was intended to circumvent government-imposed restrictions on gas exports amid domestic shortages. Due to limited exportable volumes, Santos frequently acquires gas from external suppliers to meet its international obligations.

Santos also participates in the Darwin LNG project, which is Australia's second LNG plant and the first located in the Northern Territory. The facility is supplied by the Bayu-Undan field, anticipated to be depleted during the 2020s. As a replacement, Santos is advancing plans for the Barossa project.

Barossa project

The Barossa project involves developing a new gas field in the Timor Sea intended to succeed the diminishing reserves of Bayu-Undan. It will deliver LNG to Darwin through a newly constructed pipeline that will run partially alongside the existing Bayu-Undan to Darwin Pipeline. Plans also include extracting condensate oil. Positioned approximately north of Darwin within Australian maritime boundaries, this AUD 4.7 billion initiative received approval in 2021 with production anticipated by 2025. The project is expected to generate around 600 construction jobs and maintain roughly 350 ongoing positions in Darwin over two decades.

The development has attracted criticism due to its substantial carbon footprint. Should it proceed, Barossa would become Australia's most carbon-intensive gas operation. Acquired from ConocoPhillips in 2020, it was estimated to emit 1.5 tonnes of carbon dioxide per tonne of LNG produced. A report from 2021 indicated that emissions could be lowered by integrating solar energy through Sun Cable's Australia-Asia Power Link; however, the Institute for Energy Economics and Financial Analysis (IEEFA) described Barossa as an “emissions factory with a gas by-product,” cautioning that even with carbon capture and storage technologies in place, significant emissions would continue onsite and throughout the supply chain, posing financial risks.

Barossa has faced notable legal opposition. In March 2022, leaders from the Jikilaruwu Tiwi Islands clan failed in their attempt to block South Korean financial institutions planning to lend Santos approximately AUD 950 million (£530 million). Subsequently, in June 2022, Tiwi traditional owners initiated legal action against both Santos and the federal government concerning insufficient consultation and regulatory approval processes. Issues raised include potential harm to nesting grounds of flatback and olive ridley turtles—species that serve as traditional food sources for Aboriginal communities—and proximity to four federal marine parks such as Ashmore Reef. In response, Santos submitted an environmental impact statement outlining strategies for managing oil spill risks and remediation efforts.

In September 2022, Judge Mordecai Bromberg invalidated Santos’s environmental plan, resulting in a suspension of drilling permits. Following this decision, Santos disconnected its drilling rig located north of Melville Island and withdrew from operations at the Barossa site by 6 October 2022.

Financial performance

In 2008, Santos produced a substantial volume of oil equivalent. The company’s earnings before interest, taxes, depreciation, amortisation, and exploration expenses amounted to A$2.8 billion, while its net profit after tax reached A$1.65 billion. On 22 August 2014, Santos announced its highest oil output in six years. During the first half of 2014, revenue from sales increased by 20% to $1.8 billion, accompanied by a 5% rise in sales volumes to 28.9 million barrels of oil equivalent. Nevertheless, a write-down related to its coal seam gas venture in Indonesia led to a 24% decline in first-half profit, which fell to $206 million.

The year 2015 presented financial difficulties for Santos as its share price dropped to the lowest level in over a decade amid rising debt and falling oil prices. CEO David Knox stepped down, with chairman Peter Coates stepping in to lead the company and launch a strategic review. This review explored various possibilities including partial divestments and potential acquisition offers. Coates highlighted that all options remained open, though none were favored at that stage.

Greenhouse gas emissions

In 2020, Santos was identified as one of Australia’s top 65 emitters of greenhouse gases. Under pressure from socially responsible investors, the company committed to reaching net zero emissions by 2040. Its approach includes deploying carbon capture and storage technologies, investing in renewable energy projects, and compensating emissions through tree planting initiatives.

Lobbying activities and political contributions

Santos has employed several lobbying firms such as Adelaide-based Bespoke Approach to advocate with the Australian federal government as well as state governments in New South Wales and Queensland. Other lobbying representatives have included Kreab Gavin Anderson (Australia) Ltd, Craig Emerson Economics, and Australian Public Affairs.

During the 2012–13 fiscal year, Santos made political donations at both federal and state levels to the Liberal/LNP, Labor, and National parties as outlined below:

Jurisdiction	Liberal/LNP	Labor	National
Federal	$12,950	$50,829	$10,030
South Australia	$34,367	$18,590
Queensland	$18,303	$3,300
New South Wales	$500
Western Australia	$5,910	$2,550
Northern Territory		$5,000
Tasmania	$2,500
Sturt FEC (SA)	$1,000

Moomba explosions in South Australia

On 1 January 2004, an explosion occurred at Santos’ Moomba processing site originating from the Liquids Recovery Plant (LRP). The cause was corrosion-induced failure of an inlet manifold flange weld. This failure released mercury along with a flammable gas mixture containing methane, ethane, propane, and butane. Employees promptly raised the alarm and initiated plant shutdown and evacuation procedures. Approximately 150 metres away near a heating unit, the gas cloud ignited causing extensive damage to the facility.

Unnamed employees at Moomba described operations as "cowboy" style and criticized emergency response measures; they noted that the designated muster point was dangerously close to potential hazards. The blast interrupted gas deliveries to South Australia and New South Wales resulting in manufacturing stoppages and temporary rationing of supply. Santos allocated $40 million toward remediation efforts following the incident. In 2011, the South Australian industrial relations court identified safety deficiencies including insufficient risk assessment concerning liquid metal embrittlement. Santos admitted guilt for violating the Occupational Health Safety and Welfare Act and was fined $84,000.

Sidoarjo mud flow, Indonesia

In May 2006, the Sidoarjo mud flow incident in East Java forced approximately 10,000 residents to evacuate as mud engulfed residential areas, agricultural land, and industrial zones. Although the eruption has persisted at a diminished pace since 2011, its origin remains a subject of debate.

By June 2006, Santos confirmed it held adequate insurance policies covering such incidents.

Port Bonython groundwater contamination, South Australia

Hydrocarbon contamination was identified in groundwater at Santos' Port Bonython facility within South Australia's Spencer Gulf in May 2008. To prevent further spread beyond the site and into marine environments, 150 monitoring wells were installed alongside a 450-meter cement bentonite barrier. By May 2012, Santos observed reduced hydrocarbon extraction rates from recovery wells, signaling advancement in cleanup operations.

Pilliga CSG wastewater spill, New South Wales

A spill involving 10,000 litres of untreated coal seam gas (CSG) wastewater occurred in 2011 within the Pilliga forest, impacting native plant life and soil quality. Such wastewater is known to contain heavy metals including lead and mercury. Remediation efforts have been ongoing to restore the contaminated soil at this location.

Jackson oil spill, Queensland

An uncontrolled oil release took place in May 2013 at Santos' Zeus field near Jackson in southwestern Queensland. The leak persisted for nearly seven days before being contained by international specialists, with an estimated discharge rate of 50,000 litres daily.

Uranium contamination of Narrabri aquifers, New South Wales

Groundwater testing in 2013 revealed increased salinity and heavy metal presence near Santos' Tintsfield ponds within the Pilliga forest. At the Bibblewindi ponds site, uranium concentrations were found to be twenty times above safe drinking water thresholds. A New South Wales Government inquiry classified the leak as "small, localised and contained," confirming no threat to potable water or livestock supplies. The uranium detected originated from naturally occurring soil deposits mobilized by the leak rather than from pond water itself.

Climate activism

In March 2021, four Extinction Rebellion activists interrupted operations outside Santos' Adelaide office by affixing themselves to the building and road surface, displaying painted slogans and igniting flares. Their demonstration opposed fracking practices and called on Santos to boost investments in renewable energy sources.

In September 2022, Tiwi Islanders achieved a precedent-setting court victory that halted Santos' gas drilling activities within their traditional maritime territories associated with the $4.7 billion Barossa project. The judge determined that offshore regulator Nopsema failed to ensure comprehensive consultation with all impacted stakeholders, ordering removal of the drilling rig north of Melville Island.

In 2024, Santos obtained approval to recommence installation of an underwater pipeline for the Barossa gas development in the Timor Sea following a successful legal appeal against Tiwi elders' challenge. The court found insufficient proof that pipeline construction would harm cultural heritage sites, highlighting considerable disagreement among Tiwi community members regarding traditional narratives linked to the area and concluding only a minimal likelihood of archaeological disturbance.

Pipeline explosions

In January 2023, a gas pipeline ruptured due to material fatigue, mirroring a similar event that occurred in 2020. Both incidents were reported to the South Australian Government but were not publicly disclosed until the company's 2023 Annual General Meeting and subsequent coverage by ABC News.

Sponsorship

Santos allocates substantial funds to community sponsorships across its operational regions. According to a 2014 report by The Advertiser, the company’s annual community expenditure in South Australia was $10 million. The 2014 Sustainability Report outlined community investments of $7.5 million in South Australia and $3.1 million in Queensland, with total contributions across all areas amounting to $13.2 million during the 2013–14 period.

South Australia

Major beneficiaries of Santos’ funding in South Australia include:

Adelaide Symphony Orchestra
Art Gallery of South Australia
Adelaide Botanic Garden
Come Out Festival (2009) – People’s Puppets Project, Whyalla
Committee for Adelaide – founding member
OzAsia Festival
RiAus – foundation partner contributing $5 million AUD
Santos Conservation Centre at the Adelaide Zoo
Santos Stadium athletics facility
Santos Tour Down Under, part of the UCI World Tour cycling calendar
The Smith Family
University of Adelaide – Australian School of Petroleum, with a $25 million AUD commitment over ten years

Queensland

In Queensland, Santos’ sponsorship activities have encompassed:

Queensland Art Gallery, supported with $1.5 million AUD over five years
Santos GLNG Food & Fire Fest
Queensland Police Service’s Stay on Track Outback road safety initiative (2012–2014)

ANU divestment

In October 2014, the Australian National University (ANU) made headlines by selling off its holdings in Santos along with other fossil fuel enterprises, becoming a notable example of institutional divestment from the industry. Santos highlighted the critical role of gas in shaping South Australia's future energy mix, with The Advertiser underscoring the company’s economic importance to the region. At that time, Santos had a workforce of 3,500 employees nationwide in addition to thousands of contractors and held a market capitalization of $13 billion. Political figures such as Prime Minister Tony Abbott and federal parliamentarians including Jamie Briggs, Christopher Pyne, James McGrath, Greg Hunt, and Treasurer Joe Hockey voiced their backing for Santos. Opposition to the divestment also came from senior state officials like South Australian Treasurer Tom Koutsantonis. Meanwhile, former Liberal Party leaders John Hewson and Malcolm Fraser endorsed ANU's autonomy in making investment decisions. ANU chancellor Gareth Evans emphasized that the university did not categorize Santos as "socially irresponsible" and expressed regret over any discomfort experienced by Santos CEO David Knox.

Opposition to Santos sponsorship

In December 2014, the presence of Santos branding on Queensland police vehicles sparked criticism from the anti-coal seam gas group Lock the Gate Alliance. Santos had donated approximately $40,000 to support the "Stay on Track Outback" road safety initiative, which was described as a valuable addition to the campaign efforts. Queensland Police Commissioner Ian Stewart clarified that these vehicles were "PR vehicles" intended for use at exhibitions and promotional events, functioning similarly to other marketing assets.

Online activists condemned the sponsorship as constituting a "conflict of interest" and labeled it "a bloody disgrace," with Stop Brisbane Coal Trains representative John Gordon calling for the removal of the logos. Santos responded by expressing pride in supporting a program dedicated to promoting safe driving and saving lives across outback Australia. Queensland Police Minister Jack Dempsey defended the project, noting it had been active since 2012 with backing from various sponsors.

In 2015, the Frack Free NT Alliance appealed to the Darwin Festival organizers to decline sponsorship offers from Santos due to its involvement in shale gas extraction within the Northern Territory. Activist Dayne Pratzky (Frackman) publicly supported this appeal. On 19 October 2022, Santos announced it would discontinue its two-decade-long funding arrangement with the Darwin Festival.

During 2021 and 2022, Extinction Rebellion staged protests at the Adelaide Botanic Garden opposing Santos' sponsorship of the Santos Museum of Economic Botany. Spokesperson Ben Brooker condemned this partnership—scheduled through 2029—as "a terrible stain" that contradicted the Garden’s mission focused on biodiversity preservation and conservation. He argued that accepting financial support from a fossil fuel company fundamentally undermines these core values.

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