Santos has reported an 18 per cent drop in second-quarter revenue due to lower realised prices for its oil and gas, but said production from its core assets is expected to remain steady in the near term.
The oil and gas producer said sales revenue fell to $US785 million in the June quarter from $US959 million a year earlier, and missed analyst expectations.
Average realised prices for its LNG during the three-month period slid to $US8.27 per metric million British thermal unit (mmBtu), from $US9.09 per mmBtu a year ago.
Energy players have been hit this year by a global gas glut and sluggish demand, with the coronavirus pandemic bringing economic activity to a virtual halt.
Earlier this week, Santos flagged impairments of $1.1 billion, mostly on its Queensland-based Gladstone Liquefied Natural Gas (LNG) project, owing to a more than 10 per cent reduction in the company’s long-term oil price assumption.
On Thursday, Santos reported a record production of 20.6 million barrels of oil equivalent (mmboe) during the June quarter, up from 18.6 mmboe last year, helped by higher output across its Western Australia assets.
“Production levels from our core assets are expected to remain relatively steady for the next five or six years, allowing us to continue to progress our major capital projects,” Chief Executive Kevin Gallagher said in a statement.
The Adelaide-based firm narrowly trimmed its annual production forecast to between 83 mmboe and 88 mmboe, from its earlier range of 81 mmboe and 89 mmboe.