Santos Ltd signs mid-term SPA with PetroChina

Signed mid-term sales agreement with PetroChina: Santos Ltd.’s (ASX: STO) stock rose 1.65% on July 20, 2018 to A$6.16 (3:30 PM AEST) after the company signed a mid-term LNG sale and purchase agreement (SPA) with PetroChina International (Hong Kong) Corporation Limited (PCI), for the supply of approximately 0.45 million tonnes of liquefied natural gas (LNG) per annum (mtpa), commencing in July 2018. The mid-term SPA is for supply over a three-year period. This SPA will take the total contracted volumes from the Project to 7.0 mtpa, and 6.6 million tonnes of PNG LNG’s annual output is already committed under long-term contracts to JERA, Osaka Gas, Sinopec and CPC. Further, ExxonMobil, on behalf of the PNG LNG Project participants (STO has a 13.5% interest in PNG LNG), is negotiating with a number of other parties to get mid-term LNG supply agreements for spot sales. These agreements are expected to end in the near-term and increase the sales under new mid-term agreements to 1.3 mtpa. On the other hand, STO for the first half has reported 16% growth in the sales revenue to US$1.7 billion due to stronger commodity prices and higher oil sales. The company for the second quarter has achieved the production of 14.2 million barrels of oil equivalent (mmboe), which is higher than the prior quarter due to strong production from the Cooper Basin and Western Australia gas, combined with the restart in PNG LNG production after the major earthquake activity in February. Offsetting these factors was a planned one-month maintenance shutdown of Bayu Undan/Darwin LNG during the second quarter. However, the second quarter production fell 3.4 percent from a year ago. Additionally, STO has announced a new dividend policy, according to which the company plans to pay ordinary dividends that are sustainable through the oil price cycle and will target a range of 10% to 30% payout of free cash flow per annum. Meanwhile, STO stock has risen 1.17% in three months as on July 19, 2018.


The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s