Santos announced today the acquisition of 100% of Quadrant Energy

22nd AUG 2018

Santos announced today the acquisition of 100% of Quadrant Energy for US$2.15 billion plus potential contingent payments.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said Santos has enjoyed a long-established relationship with Quadrant which has operated its WA natural gas assets for many years developing a well-deserved reputation as a safe, high reliability and low cost operator.

“This acquisition delivers increased ownership and operatorship of a high quality portfolio of low cost, long-life conventional Western Australian natural gas assets which are well known to Santos, and importantly significantly strengthens Santos’ offshore operating capability.”

“It is materially value accretive for Santos shareholders and advances Santos’ aim to be Australia’s leading domestic natural gas supplier.”

“The transaction lowers our proforma 2018 forecast free cash flow breakeven oil price by a further $4/bbl and Quadrant’s stable cash flows provide increased certainty during the upcoming period of major growth project delivery.”

“We look forward to welcoming Quadrant’s staff to the Santos family and integrating our Western Australian operations,” Mr Gallagher said.

1 Proforma reserves based on Santos and Quadrant 2P reserves as at 31 December 2017.

2 Proforma production based on Santos and Quadrant production for the year ended 31 December 2017.

Quadrant Portfolio Overview

Quadrant Energy holds natural gas and oil production, near and medium term development, appraisal and exploration assets across more than 52,000 km2 of acreage, predominantly in the Carnarvon Basin offshore WA, Australia’s largest offshore oil and natural gas province.

Quadrant’s share of production from the assets in 2017 was 19 million barrels of oil equivalent (mmboe). 2P reserves at the end of 2017 were 220 mmboe (~75% developed).

Quadrant’s conventional natural gas assets include significant portfolio overlap with Santos, providing opportunity to realise material combination synergies estimated at

US$30-50 million per annum.

Assets




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