Santos delivered a robust performance in 2025, underpinned by strong base business results, disciplined capital management and continued progress across major growth projects. The company generated free cash flow from operations of approximately $380 million in the fourth quarter, an increase of 30 percent on the prior quarter, lifting full year free cash flow to around $1.8 billion. The free cash flow breakeven price for the year was below $30 per barrel, reflecting Santos’ low-cost operating model.
Production remained resilient despite challenging operating conditions, with fourth quarter production of 22.3 million barrels of oil equivalent, up five percent quarter on quarter. Full year production reached 87.7 million barrels of oil equivalent. Sales volumes increased to 24.8 million barrels of oil equivalent in the fourth quarter, up 15 percent on the prior quarter, with full year sales volumes of 93.5 million barrels of oil equivalent. Sales revenue exceeded $1.2 billion in the fourth quarter and more than $4.9 billion for the full year. Unit production costs for the year remained below $7 per barrel of oil equivalent, excluding Bayu Undan, and within guidance. Gearing reduced to 26.8 percent, or 21.5 percent excluding operating leases.
A major milestone was achieved at Barossa LNG, with the first LNG cargo now loading at Darwin LNG. The BW Opal FPSO continued start-up and commissioning activities, ramping up gas export volumes to approximately 450 million standard cubic feet per day, around 75 percent of plant capacity. The six-well drilling programme in the Barossa gas field was successfully completed, with all wells intersecting excellent reservoir quality and average individual well deliverability of approximately 300 million standard cubic feet per day. LNG production commenced following completion of the Darwin LNG life extension project, and the first cargo has been sold on a delivered ex-ship basis for delivery to the Sakai terminal in Japan.
At Pikka Phase 1, the project reached 98 percent completion and is nearing mechanical completion, with commissioning progressing. Twenty-four wells were drilled and completed by the end of the fourth quarter, including the 23rd well which achieved the highest productivity to date, producing approximately 8,000 barrels per day. While capital expenditure for Phase 1 increased by around $200 million Santos share due to inflationary pressures, tariffs and logistics costs, the project remains on track for first oil late in the first quarter of 2026, with ramp-up to plateau expected mid-year.
Operational performance across the portfolio remained strong. In Papua New Guinea, the Hides F2 well was completed with an accelerated and safe start-up. Western Australia domestic gas production increased by approximately 19 percent following the successful completion of major shutdowns and compression upgrades. In the Cooper Basin, output recovered to pre-flood levels, with 91 wells returned to production in the fourth quarter. GLNG delivered full year LNG production of 6 million tonnes, with record production achieved across multiple fields and facilities.
Santos also advanced its growth and energy transition initiatives. A well-priced mid-term LNG portfolio supply contract was signed for approximately 0.6 million tonnes per annum from 2026. Preparations continued for the Beetaloo Basin appraisal programme, with regulatory approvals submitted and consultation undertaken. Moomba Carbon Capture and Storage Phase 1 continued to perform to plan, permanently storing more than 1.5 million tonnes of CO2 equivalent since start-up and receiving more than 900,000 Australian Carbon Credit Units.
Disciplined capital management remained a key focus. During the year, Santos raised a $1 billion senior unsecured fixed-rate bond, accelerated repayment of the PNG LNG project finance facility, and completed several non-core asset divestments to sharpen portfolio focus and strengthen the balance sheet.
Santos managing director and CEO Kevin Gallagher said that continued focus on operational excellence, disciplined project execution and safety underpinned the company’s performance throughout the year.
“Personal and process safety, and environmental performance, was outstanding, with the company in the top quartile of global industry benchmarks for personal safety and better than global average for process safety and environment performance,” Mr Gallagher said.
He added that the performance of the base business was a highlight of 2025, particularly given the impact of severe flooding in the Cooper Basin, and that Santos is now well positioned for production growth as Barossa and Pikka move into production.
Looking ahead, Santos expects Barossa LNG and Pikka Phase 1 together to lift production by around 25 to 30 percent by 2027 compared to 2024 levels, reinforcing the company’s platform for sustainable growth, disciplined capital allocation and long-term shareholder value.
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