Santos 3Q Sales Revenue Falls 12% as Barossa Output Boost Looms

By David Winning

SYDNEY--Santos said third-quarter sales revenue fell by 12% as its liquefied natural gas fetched lower prices, while production fell slightly ahead of a major boost from the Barossa natural gas project in Australia coming online.

Santos reported sales revenue of US$1.12 billion in the three months through September, below the US$1.29 billion achieved in its fiscal second quarter. LNG prices fell by 4.5% to US$11.05 per million British thermal units, while crude oil prices were up modestly at US$71.30 a barrel.

Production totaled 21.3 million barrels of oil equivalent in the quarter, down 4% on the three months through June. Santos began production operations at the Barossa project late in September, representing the first of two large projects that it will commission over the next 12 months.

Santos's quarterly report was the first by the Adelaide-based energy company since a consortium led by Abu Dhabi National Oil Co. abandoned a $18.7 billion takeover offer around the middle of last month. The deal foundered on disagreements over terms given the length of time it could take for a transaction to complete.

On Thursday, Santos signaled confidence in its operations that include minority stakes in the PNG LNG export terminal in Papua New Guinea, oil fields in the Cooper Basin, and a carbon capture and storage project at Moomba in central Australia.

Chief Executive Kevin Gallagher said a software issue affecting safety systems on board the BW Opal floating production storage and offloading unit led to an unplanned shutdown of around two weeks last month. This impacted the rampup of the Barossa project, he said.

"Pleasingly, these issues have now been resolved and are behind us," Gallagher said.

First production at the Darwin LNG facility using Barossa gas is expected in coming weeks, meaning Barossa is on track to ship its first LNG cargo before the end of December, Santos said.

Santos added that its Pikka Pase 1 oil project in Alaska is more than 95% complete and on track to produce oil for the first time in the first quarter of next year.

"With around US$1.4 billion of free cash flow from operations generated year-to-date, Santos is well positioned to deliver strong shareholder returns with imminent production growth as we bring Barossa LNG online and move closer to the start-up of Pikka," Gallagher said.

Santos lowered its annual production guidance to 89 million-91 million BOE.

Write to David Winning at david.winning@wsj.com

Corrections & Amplifications

This article was corrected at 0021 GMT to reflect Santos lowered its annual production guidance to 89 million-91 million BOE. The original version incorrectly said Santos kept its annual production guidance unchanged in the last paragraph.

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October 15, 2025 18:59 ET (22:59 GMT)