ASX / Media Release
14 October 2019
Acquisition ofConocoPhillips’ northern Australia interests
Key Highlights
 Acquisition ofConocoPhillips’ northern Australia business with operating interests in
Darwin LNG, Bayu-Undan, Barossa and Poseidon forUS$1.39 billion plus a
$75 million contingent payment subject to FID on Barossa
 Value accretive acquisition of operating interests in long-life, low cost natural gas assets and strategic LNG infrastructure consistent with Santos' core asset growth strategy
 Fully funded from existing cash resources and new committed debt
 Materially accretive:~16% expected earnings per share accretion and~19% EBITDAX accretion in 20201
 Increases pro-forma production by~25%, pro-forma 2P reserves by~5% and pro-forma 2C contingent resources by~27%2
 Reduces forecast 2020 free cash flow breakeven oil price by~US$4 per barrel
 Targeting pre-tax synergies ofUS$50-75 million per annum (excluding integration and other one-off costs) driven by Santos operatorship and efficiencies
 Acquisition delivers operatorship and control of strategic LNG infrastructure with growth potential
 Acquisition advances and supportsSantos’ goal of taking Barossa FID by early 2020.
Santos is prepared to sell down equity in Barossa and Darwin LNG to a target ownership of40-50% to achieve increased partner alignment
 Barossa partner SKE&S is highly supportive and has signed a Letter of Intent to acquire a25% interest in Bayu-Undan and Darwin LNG
 Santos is also in discussions with existing Darwin LNG joint-venture partners for equity in Barossa and in advanced discussions with LNG buyers for Barossa offtake volumes,
including with an existing partner in Darwin LNG
Santos Managing Director and Chief Executive Officer Kevin Gallagher said Santos has
enjoyed a long-established relationship with ConocoPhillips which has operated its northern Australia natural gas assets for many years.
“Santos was a founding partner with ConocoPhillips in Darwin LNG, which has been
operating since 2006. The acquisition of these assets fully aligns withSantos’ growth
strategy to build on existing infrastructure positions while advancing our aim to be a leading regional LNG supplier,” Mr Gallagher said.
1 Expected pro-forma accretion in 2020 assumingUS$65 per barrel oil price and full-year of ownership. Assumes Santos interest of68.4% in Bayu-Undan/Darwin LNG and62.5% in Barossa (i.e. pre sell-down to SKE&S).
2 2018 pro-forma based onSantos’ 2018 production and reserves and resources. Production adjusted for a full-year of Quadrant ownership. Assumes Santos interest of68.4% in Bayu-Undan / Darwin LNG and62.5% in Barossa (i.e. pre sell-down to SKE&S).
Media enquiries Investor enquiries Santos Limited ABN 80 007 550 923
Daniela Ritorto Andrew Nairn GPO Box 2455, Adelaide SA 5001
+61 8 8116 5167 /+61 (0) 455 319 770 +61 8 8116 5314 /+61 (0) 437 166 497 T+61 8 8116 5000 F+61 8 8116 5131
daniela.ritorto@santos.com andrew.nairn@santos.com www.santos.com
Page 1 of 6
“This acquisition delivers operatorship and control of strategic LNG infrastructure at Darwin, with approvals in place supporting expansion to 10 mtpa, and the low cost, long life Barossa gas project.
“These assets are well known to Santos. It also continues to strengthen our offshore
operating and development expertise and capabilities to drive growth in offshore northern and Western Australia.”
“Santos is also committed to beAustralia’s leading domestic gas supplier and we will be
pursuing domestic gas opportunities in the Northern Territory from our broader northern
Australia gas portfolio where we have significant resource potential both onshore and
offshore.”
“Santos intends to manage gearing within our stated operating range and is targeting to sell- down equity in Darwin LNG and Barossa to40-50% in order to create alignment between joint venture participants as well as by optimising equity levels in our Western Australia
assets.”
“We are also in discussions with existing Darwin LNG joint-venture partners to sell equity in Barossa and further equity in Darwin LNG and also with LNG buyers for offtake volumes. Santos will target the contracting of~60-80% of LNG volumes for10+ years prior to taking FID on Barossa, which is expected by early 2020. Discussions to date have demonstrated strong interest in Barossa LNG, given it is a brownfield upstream development located close to North Asian demand.”
“The acquisition is value accretive for Santos shareholders in year one following completion across a range of metrics and importantly further reduces our free cash flow breakeven oil price by approximatelyUS$4 per barrel in 2020.”
“As we have demonstrated following the acquisition and integration of Quadrant Energy into our offshore business,Santos’ low-cost operating model is creating opportunities for
disciplined growth across Australia.”
“We look forward to welcomingConocoPhillips’ Australia-West employees to Santos and combining the two businesses to create one high performing team with a wide range of
exciting career opportunities across Santos,” Mr Gallagher said.
Page 2 of 6
ConocoPhillips Northern Australia Portfolio Overview
ConocoPhillips holds a high-quality portfolio of operated production, development and
exploration assets in northern Australia. It also operates and is the majority owner of the
Darwin LNG facility, which has a capacity of 3.7 million tonnes per annum of LNG and
significant expansion potential.
|||||
|-|-|-|-|
||Darwin LNG|Bayu-Undan|Barossa|
|Asset|Infrastructure|Production|Development|
|Key statistics||||
|(gross)||||
||ConocoPhillips 56.9%|ConocoPhillips 56.9%||
||Santos 11.5%|Santos 11.5%||
||||ConocoPhillips 37.5%|
||INPEX 11.4%|INPEX 11.4%||
|Ownership|||Santos 25%|
||Eni 11.0%|Eni 11.0%||
||||SK E&S 37.5%|
||JERA 6.1%|JERA 6.1%||
||Tokyo Gas 3.1%|Tokyo Gas 3.1%||
|Operator||||

1 Santos net62.5% interest post-completion is 499 mmboe net 2C resource.
Barossa Project
The Barossa project is the lead candidate to backfill Darwin LNG and continues to make
excellent progress towards a final investment decision early next year. Barossa is intended to be developed using subsea wells tied back to an FPSO for gas processing and condensate export. A 260-kilometre gas export pipeline will transport gas to the existing Bayu-Undan pipeline for onwards transport to Darwin LNG.
Recent project milestones include the award of the subsea production system contract, the award of the gas export pipeline contract and entering into exclusive negotiations with
Darwin LNG for the supply of backfill gas. Evaluation of tenders for the FPSO, subsea
umbilicals and flowlines and drilling rig packages are progressing well.
Santos currently expects a final investment decision on Barossa by early 2020, with first LNG expected in 2024. Barossa development capex is currently expected to be approximatelyUS$4.7 billion (2019 real) to first gas.
Barossa is expected to extend the operating life of Darwin LNG by more than 20 years. Life extension capex at Darwin LNG of approximatelyUS$600 million (2019 real) is expected to be incurred between Bayu-Undan end of field life and the commencement of production at Barossa.
Page 3 of 6
Acquisition Rationale
The acquisition ofConocoPhillips’ northern Australia portfolio is fully aligned withSantos’ growth strategy to build on existing infrastructure positions around thecompany’s core
assets.
The acquisition delivers operated interests in long-life low cost gas assets including Darwin LNG, Bayu-Undan, Barossa and Poseidon. It also brings operatorship of a strategically
located LNG hub with significant expansion potential and longer-term opportunities to
monetiseSantos’ material resources in the region.
The acquisition also continues to strengthenSantos’ offshore operating and development expertise and capabilities to drive growth in offshore northern and Western Australia.
The acquisition is financially compelling and value accretive for shareholders across a range of short and long-term financial metrics. Santos is targeting material synergies of
US$50-75 million per annum (pre-tax) from the acquisition.
Consideration
Santos will acquireConocoPhillips’ interests in northern Australia for total consideration ofUS$1.465 billion, comprising aUS$1.39 billion upfront payment at completion and a
US$75 million contingent payment once a final investment decision on Barossa is made. ConocoPhillips will continue to support the FID process for Barossa.
The acquisition will have an effective date of 1 January 2019. Santos will have the benefit of cash flows generated by the acquired business from the effective date with customary
adjustments.
Completion is subject to third-party consents and regulatory approvals.
SKE&S support
SKE&S is a major participant in Barossa with a37.5% stake. SKE&S is highly supportive of the transaction and Santos becoming operator.
Santos and SKE&S have signed a Letter of Intent for SKE&S to acquire a25% interest in Bayu-Undan and Darwin LNG, which would further align Santos and SKE&S toward the
development of Barossa, a key priority for both companies.
Page 4 of 6
Acquisition Funding
The net funding requirement for the acquisition is expected to be approximately
US$775-825 million, post the benefit of cash flows generated from the acquired business from the effective date of 1 January 2019 to completion with customary adjustments and
proceeds realised from the expected sell-down to SKE&S.
The net funding requirement will be fully funded fromSantos’ current cash resources andUS$750 million in new committed two-year acquisition debt. It is intended that the acquisition debt will be refinanced post-completion of the acquisition.
Santos hadUS$1.2 billion in cash on hand as at 30 June 2019.
In-line with its long-standing strategy, Santos intends to maintain a strong financial profile consistent with an investment grade credit rating. Net gearing is expected to decline to~30% by the end of 2020. De-gearing will be supported bySantos’ strong free cash flow profile and through potential sell-downs in Barossa and Darwin LNG. Santos also expects to maintain available liquidity in excess ofUS$2 billion.
Santos also has flexibility to reduce gearing further by optimising its broader asset portfolio through strategically-aligned farm-outs and disposals.
Advisers
Credit Suisse (Australia) Limited and J.B. North& Co. are acting as financial advisers to Santos and Allens is acting as legal adviser to Santos.
Conference call
Santos will host a conference call for analysts and investors today at 9:30am AEDT.
Dial-in numbers for the conference call are listed below. Conference ID: 6580332.
For locations within Australia dial toll-free 1800 123 296 or toll 02 8038 5221.
For other countries, please use one of the following toll-free numbers: Canada (1 855 5616 766); China (4001 203 085); Hong Kong (800 908 865); India (1800 2666 836); Japan (0120 994 669); New Zealand (0800 452 782); Singapore (800 616 2288); United Kingdom (0808 234 0757); United States (1 855 293 1544). For all other countries or operator assistance, please call+61 2 8038 5221.
Page 5 of 6
Call replay details
Dial-in numbers for the call replay are listed below. Conference ID: 6580332.
For locations within Australia dial toll-free 1800 153 898 or toll 02 9003 4221.
For other countries, please use one of the following toll-free numbers: Canada (1 855 7590 869); China (4006 322 162); Hong Kong (800 963 117); India (1800 3000 0542); Japan (0120 390 774); New Zealand (0800 453 213); Singapore (800 616 2305); United Kingdom (0808 234 0072); United States (1 855 4525 696). For all other countries or operator assistance, please call+61 2 9003 4211.
Ends.
Page 6 of 6
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|Acquisition of ConocoPhillips’northern Australia interests|
|14 October 2019|

Disclaimer and important notice
This presentation contains forward looking statements that are subject to risk factors associated with the oil and gas industry. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a range of variables which could cause actual results or trends to differ materially, including but not limited to: price fluctuations, actual demand, currency fluctuations, geotechnical factors, drilling and production results, gas commercialisation, development progress, operating results, engineering estimates, reserve estimates, loss of market, industry competition, environmental risks, physical risks, legislative, fiscal and regulatory developments, economic and financial markets conditions in various countries, approvals and cost estimates.
All references to dollars, cents or$ in this document are to United States currency, unless otherwise stated. Pro-forma metricsare quoted before any impact of purchase price accounting on acquisition.
This presentation refers to estimates of petroleum reserves. Refer to slides 27-28 in the Appendix for cautionary statement regarding reserve estimates.
Santos Ltd 2
1 Transaction overview
2 Investment highlights
3 Funding
Appendix
Santos Ltd 3
Investment highlights
Santos to acquireConocoPhillips’ interests in and operatorship of Darwin LNG, Bayu-Undan, Barossa and Poseidon for$1.39 billion plus a contingent$75 million on Barossa FID Fully aligned withSantos’ core asset growth strategy
Operatorship of strategically located LNG hub with approvals in place for expansion to 10 mtpa~16% EPS accretiveand reduces free cash flow breakeven oil price by~$4/bbl1
Value creation from synergies of$50-75 million (pre-tax) per annum
Barossa partner SKE&S has signed an LOI to acquire25% interest in Bayu-Undan and DLNG Fully funded from current cash resources and new debt
1Expected pro-forma accretion and free cash flow breakeven in 2020 assumingUS$65 per barrel oil price and full-year of ownership.Assumes Santos interest of68.4% in Bayu-Undan/Darwin LNG and62.5% in Barossa (i.e. pre sell-down to SKE&S).
Santos Ltd 4
Investment highlights
Materially accretive and strategic growth acquisition
EPS ACCRETION1 EBITDAX ACCRETION1 FCFBE OIL PRICE116% 112% 19% $4/bbl 2P+ 2C INCREASE2 GEARING AT COMPLETION OPERATING CASH FLOW BEFORE SELL-DOWN3 ACCRETION1
540
35% 15%
19% 4%
mmboe
1Expected pro-forma accretion and free cash flow breakeven in 2020 assumingUS$65 per barrel oil price and full-year of ownership. Assumes Santos interest of68.4% in Bayu-Undan / Darwin LNG and62.5% in Barossa (i.e. pre sell-down to SKE&S).
2Pro-forma 31 December 2018. Assumes Santos interest of68.4% in Bayu-Undan / Darwin LNG and62.5% in Barossa (i.e. pre sell-down to SKE&S).
3Pro-forma assuming acquisition occurred on 30 June 2019. Before expected sell-down to SKE&S.
Santos Ltd 5
Strategically aligned acquisition
Brownfield growth building on existing infrastructure positions
Strategically
+ Fully aligned withSantos’ growth strategy to build on existing infrastructure positions around our core business aligned acquisition
+ Builds offshore operating position and expertise to continue to drive growth across northern Australia and offshore WA+ Delivers operatorship of a strategic LNG hub with approvals in place for expansion to 10 mtpa
+ Unlocks opportunities to create value through strategic partnerships to bring discovered resources to market, Significant
leveragingSantos’ strong operating capabilities
portfolio upside
+ Increases exposure to high quality, low-cost production and development assets strategically located, with growth potential underpinned by robust long-term Asian LNG demand
+ Advances and supportsSantos’ goal of taking Barossa FID by early 2020. Santos is prepared to sell-down equity in Barossa and DLNG to a target ownership of40-50% to achieve increased partner alignment
+ Barossa partner SKE&S is highly supportive of the transaction and Santos becoming operator. Santos and SKE&S have signed a Letter of Intent for SKE&S to acquire a25% interest in Bayu-Undan and Darwin LNG, subject to Advances partner
execution of a sale and purchase agreement
alignment
+ Santos is in discussions with existing Darwin LNG joint-venture partners for equity in Barossa and further equity in Darwin LNG, to achieveSantos’ objective of partner alignment
+ Santos is also in advanced discussions with LNG buyers for Barossa offtake volumes, including with an existing partner in Darwin LNG
Santos Ltd 6
Fully aligned withSantos’ growth strategy
2018 production increase1,2
+ Greater alignment and interest in a leading integrated LNG project
mmboe
 Material, high
+ Material increase in production, resources and EBITDAX
+19 mmboe
quality, 94 75
operated LNG + Operatorship of strategically located LNG infrastructure hub
growth
+ Long-term LNG expansion potential
platform
+ Clear pathway to Barossa FID
Santos 2018 pro-forma
||
|-|
| Core, longlife, low costassets|
| Existing cashflowgeneration,financialstrengthmaintained|

||
|-|
|+ Long life, production and development assets+ Assets are well known to Santos+ Barossa production forecast to extend out to 2040s+ Project economics robust in current LNG contracting environment+ Free cash flow positive at <$40/bbl, pre-major growth spend|
|+ Immediate uplift in cash-flow from Bayu-Undan+ High margin assets+ Fully funded from cash and new debt+ De-gearing supported by strong free cash-flow profile andexpected sell-down of Barossa and DLNG interests+ Flexibility to optimise asset portfolio through farm-outs and disposals|

Materially accretive transaction
Financially compelling acquisition expected to deliver substantial accretion on all key metrics+ Increases 2018 pro-forma production by25% to 94 mmboe1
Strong
production and
+ Increases 2018 pro-forma 2P reserves by 50 mmboe(+5%) and 2018 pro-forma 2C resources by 490 mmboe(+27%)1 resources
growth
+ Barossa 2C resources to convert to 2P reserves at FID, expected by early 2020
Material +~16% expected earnings per share accretion in 20202
earnings per
share accretion +~19% expected EBITDAX accretion in 20202
+~15% expected operating cash flow per share accretion in 20202
Cash flow
+ Reduces 2020 forecast free cash flow breakeven oil price by~$4/bbl
accretion
+ No change to stated dividend policy, targeting a range of10% to30% payout of free cash flow generated per annum+ Material value per share accretion
Potential value
uplift
+ Targeting synergies of$50 to$75 million per annum (pre-tax)3
12018 pro-forma based onSantos’ 2018 production and reserves. Production adjusted for a full-year of Quadrant ownership.Assumes Santos interest of68.4% in Bayu-Undan / Darwin LNG and62.5% in Barossa (i.e. pre sell-down to SKE&S). 2AssumesUS$65 per barrel oil price in 2020 and full year of ownership.
3Excludes integration and other one-off costs.
Santos Ltd 8
Transaction overview and financing
Acquisition of + Santos has agreed to acquireConocoPhillips’ interests in northern Australia for$1.39 billion payment at completion, with a further$75 million contingent on FID decision at Barossa
ConocoPhillips’
interests in + Key assets include:56.9% interest in Bayu-Undan field and Darwin LNG facility,37.5% interest in the Barossa Project northern
+ Transaction has an effective date of 1 January 2019and completion is subject to third-party consents and regulatory approvals. Santos Australia
will have the benefit of cash flows generated by the acquired business from the effective date with customary adjustments.+ Net funding requirement of approximately$775-825 million, post the benefit of cash flows generated from the acquired business from the effective date of 1 January 2019 to completion with customary adjustments and proceeds from the expected sell-down to SKE&S+ Net funding requirement fully funded from cash resources and new committed debt
̶ Santos had$1.2 billion in cash on hand as at 30 June 2019
̶$750 million in new committed two-year acquisition debt
Transaction
financing + 30 June 2019 pro-forma net debt of$4.5 billion($3.1 billion excluding PNG LNG project finance)1
̶ Expect to maintain a strong financial profile consistent with an investment grade credit rating
̶ Strong liquidity maintained:$2.8 billion liquidity based on pro-forma 30 June 20191
̶ Pro-forma gearing expected to be~35% at completion and decline to~30% by year end 2020
+ De-gearing will be supported bySantos’ strong free cash flow profile and expected sell-downs
1Pro-forma assuming acquisition occurred on 30 June 2019.
Santos Ltd 9
1 Transaction overview
2 Investment highlights
3 Funding
Appendix
Santos Ltd 10
Portfolio of long-life production and development assets
Full alignment withSantos’ strategy to become a leading domestic gas and LNG supplier with a portfolio of low-cost, long life assets
||||||
|-|-|-|-|-|
||Darwin LNG|Bayu-Undan|Barossa|Poseidon|
||Infrastructure|Production|Development|Exploration|
|Santosownership1|68.4% (operator)|68.4% (operator)|62.5% (operator)|40% (operator)|
|Key metrics(gross)|+Capacity: 3.7 mtpa+2018 LNG sales: 3.3mt+Life extension capex ~$0.6 billion|+2018 production: 40 mmboe+2P reserves: 108 mmboe+2C resources: 22 mmboe+Abex~$1.1 billion|+2C resources: 799 mmboe+Development capex ~$4.7 billionto first gas|+2C resources: 410 mmboe|
|Acquired 2Preservesand 2C contingentresources2 (net)||+2P reserves: 46 mmboe+2C resources: 11 mmboe|+2Cresources: 300 mmboe|+2C resources: 164 mmboe|
|Overview|+Reliable liquefaction facility+Operating since start-up in 2006+Potential for future capacityexpansion (up to 10 Mtpa)|+Producing gas condensate fieldsupplying gas to Darwin LNG+Robust cashflow generation+Associated pipeline is a wellmaintained regional asset+Mature asset approaching EOFL~2022with potential to extend|+Preferred candidate to backfillDarwin LNG project+Currently in FEED+FID expected by early 2020+Firstgas expected 2024|+Potential to support longer termLNG expansion in region+Retention Licence applicationlodged September 2018|

1 Santos pro-forma ownership following completion of the acquisition ofConocoPhillips’ northern Australia interests (i.e. pre sell-down to SKE&S).
Santos Ltd
2Santos acquired reserves and resources at completion of the acquisition of ConocoPhillips northern Australia interests (i.e. pre sell-down to SKE&S).
11
Note: Pro-forma reserve and resource estimates as at 31 December 2018.
Advances alignment and supports Barossa FID
Santos is prepared to sell-down to40-50% interest in Barossa and DLNG to increase partner alignment. SKE&S has signed an LOI to acquire25% interest in Bayu-Undan and DLNG
|||
|-|-|
|Current|Pro-forma|

 Bayu/ Bayu/
Partner Barossa Operator Barossa Operator
DLNG DLNG taking FID by early 2020
||||||
|-|-|-|-|-|
||56.9% 37.5%||||
||11.5% 25%||||
||11.4% -||||
||11.0% -||||
||6.1% -||||
||3.1% -||||
||- 37.5%||||
|Total|100%|100%|100%|100%|

Santos Ltd
1Santos holding expected to be43.4% post25% sell-down to SKE&S.
Operatorship of strategically located LNG hub
Northern Australia has the potential to become a major LNG hub for the long term, supported bySantos’ world class regional onshore and offshore gas resources and proximity to Asia Creation of a major LNG hub strategically located to key LNG end DLNG expansion supported by regional resource markets
+ Material interest in a high quality integrated LNG project
+ Leverages and strengthens Santos existing offshore operating capability
in Northern Territory and Western Australia
+ Operatorship of strategic LNG infrastructure:
+ DLNG brownfield plant expansion opportunities
+ Planning approvals for expansion up to 10 mtpa (3 train plant)
+ Potential to unlock material resources in the region
||||
|-|-|-|
|Santos acreage|Gross 2C resource|Net 2C resource|
|Barossa|~5.1 tcf|2,600 PJ|
|Petrel-Tern-Frigate|~2.6 tcf|970 PJ|
|Browse Basin1|~2.8 tcf|850 PJ|
|Greater Poseidon|~2.1 tcf|880 PJ|
|McArthur Basin|Multi-tcf potential||

1Includes Lasseter, Crown, Burnside, Argus
2 Resource estimates as at 31 December 2018
Santos Ltd 13
Long-term LNG market dynamics remain favourable
Prior to taking FID on Barossa, Santos intends to target contracting~60-80% of LNG volumes for10+ years
Global LNG supply / demand
Mtpa
+ Underpins brownfield LNG development
600
+ Attractive20+ year asset life for DLNG backfill 500
+ In discussions with LNG buyers– Barossa LNG has been well received
400
given brownfield nature and proximity to Asian demand 300
200
+ Uncontracted volumes provide flexibility
2015 2020 2025 2030 Operational Under Construction LNG Demand Darwin LNG is well positioned to support LNG demand
+ Global LNG demand grew~10% in 2018
 Shipping advantage due to proximity to key Asian markets
+ Expected to grow by~5% CAGR to 2030
 Globally competitive cost of supply
+~80 mmtpa of uncontracted demand expected by 2025 Source of diversification for LNG buyers
+~110 mmtpa of new supply required by 2030
 Potential to fully align across the value chain
+ Renewed interest from buyers for long-term contracts
Santos Ltd Source: Wood Mackenzie, LNG Tool Q3 2019 Dataset 14
Value creation via synergies and operatorship
Targeting synergies of$50 to$75 million per annum (pre-tax)
+ Targeting synergies of$50 to$75 million per annum (pre-tax)
̶ Removal of duplication
Material
̶ Optimise operations across the combined asset footprint
synergies
̶ Corporate and overhead savings
+ Full synergy potential to be assessed during integration
+ Value creation through scale and operating capabilities
Operatorship
+ Greater alignment of upstream and midstream interest allows for clear route to Barossa FID
and offshore
+ Leverage offshore operating capabilities to capitalise on Barossa
capabilities
+ Combined upstream capabilities strengthen platform for sustainable growth
|||
|-|-|
|Quadrantexperience|+ Santos acquired Quadrant Energy in late 2018+ During acquisition due diligence, Santos identified $30-50 million per annum of cost savings through organisationalefficiencies (overheads, support costs, role duplication)+ Since taking ownership of Quadrant, Santos has increased its synergy target to $50-60 million per annum+ Santos expects to generate synergies from this transaction through applying its low cost operating model andknowledge/experience gained from the Quadrant acquisition|

Santos Ltd 15
Consistent withSantos’ strategy of upgrading portfolio
Organic and inorganic growth strategy has materially improved our portfolio
80% core assets now 2018 pro-forma Santos today versus 2015
Santos operated production up62%1 mmboe
 Portfolio simplified and high-graded
7 94 Focused on operating positions across
||
|-|
|5|
|2|

||
|-|
|1|
|4|

2015 2018 2015 2018 Targeting lower risk, higher returns from
pro-forma pro-forma upstream / brownfield growth projects
12018 pro-forma production assumes Santos
interest of68.4% in Bayu-Undan / Darwin
LNG and62.5% in Barossa(i.e. pre sell-down
to SKE&S)
Santos Ltd 16
Fully aligned with Transform Build Grow
Acquisition fully aligned withSantos’ strategy to leverage existing infrastructure positions around our core long-life natural gas assets
+ Execute and bring on-line growth opportunities across the core portfolio
+ Focused exploration strategy to identify new high-value targets and unlock future core assets Grow
+ Generate new revenue through low-carbon Energy Solutions projects
+ Develop low-risk, brownfields growth prospects across the core portfolio+ Pursue strategically aligned, value accretive acquisition opportunities Build
+ Leverage facilities and infrastructure operations strategic capability+ Maximise margin throughM&T business
+ Diverse and balanced portfolio of five core, long-life natural gas assets+ Robust balance sheet
Transform + Lowest cost onshore operator in Australia
+ Disciplined, low cost operating model, portfolio free cash flow breakeven at≤$40/bbl oil price
Santos Ltd 17
1 Transaction overview
2 Investment highlights
3 Funding
Appendix
Santos Ltd 18
Acquisition funding
Acquisition fully funded from current cash and new committed debt
+ Net funding requirement is expected to be approximately$775-825 million, post the benefit of cash flows generated from the acquired business from the effective date of 1 January 2019 to completion and proceeds from the expected sell-down to SKE&S Acquisition fully
funded from cash + Net funding requirement fully funded from cash resources and new committed debt
and new debt
̶ Santos had$1.2 billion in cash on hand as at 30 June 2019
̶$750 million in new committed two-year acquisition debt
+ De-gearing supported by strong free cash-flow and potential sell-down of Barossa and DLNG to a target ownership of40-50% De-gearing
supported by
+ Existing cash flow generation and financial strength maintained
strong free cash
flow and potential + SKE&S has signed a letter of intent for SK to acquire25% interest in Bayu-Undan and Darwin LNG
sell-down
+ Flexibility to optimise asset portfolio through farm-outs and disposals
Investment grade
+ Expect to maintain a strong financial profile consistent with an investment grade credit rating
credit rating
+~$2.8 billion liquidity based on pro-forma 30 June 20191
Strong liquidity ̶~$0.8 billion in cash
̶~$2.0 billion of bilateral facilities
1Pro-forma assuming acquisition occurred on 30 June 2019.
Santos Ltd 19
Stable cash flows underpin strong de-leveraging and liquidity Targeting medium term gearing ratio of25-30%, with sufficient flexibility to address all future capital expenditure requirements and maintain dividend policy
Gearing post growth funding and dividends1 Disciplined capital management
Net debt / (Net debt+ Equity)
+ De-gearing supported bySantos’ strong free cash flow profile Before expected sell-
and through a potential sell-down of interests in the acquired down to SKE&S
~35% assets
~25-30% + Gearing of~25-30% expected during 2021-24 capex growth
 Pro-forma 2021-24 capex growth
to shareholders
at completion phase, post targeted sell-
down to40-50% interest
+ Flexibility to optimise the broader Santos asset portfolio through strategically aligned farm-outs and disposals
Projected gearing profile assumes FID for PNG LNG
expansion, Barossa backfill to DLNG, Dorado oil and
sell-down of interests in the acquired assets
1AssumesUS$65 per barrel flat real oil price and full-year of ownershipof the acquired interests in 2019.
Santos Ltd 20
Pro-forma drawn debt maturity profile
$750 million committed acquisition debt to be repaid with sell-down proceeds or refinanced post completion
Pro-forma drawn debt maturity profile Pro-forma drawn debt maturity profile1 excluding PNG LNG project finance1 Breakdown of drawn
$million
$750 million acquisition debt debt facilities1
$million
||
|-|
|$750 million acquisition debtexpected to be refinanced via|
|bank term loan, bond markets orrepaid with sell-down proceeds|

994 989 72%
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201920202021202220232024202520262027202820292030
to maturity~4.9 years 201920202021202220232024202520262027202820292030 Committed Acquisition Finance Bank term loans Committed Acquisition Finance Bank term loans
Reg-S Bond Long-term notes Reg-S Bond Long-term notes
ECA supported loan facilities PNG LNG project finance ECA supported loan facilities
¹ Pro-forma assuming acquisition occurred on 30 June 2019. Excludes leases and derivatives.
Santos Ltd 21
1 Transaction overview
2 Investment highlights
3 Funding
Appendix
Santos Ltd 22
Darwin LNG overview
Darwin LNG is a world-class LNG facility (ConocoPhillips operated56.9%, Santos11.5%)+ Darwin LNG is a 3.7 mtpa LNG facility located in Wickham
Point in the city of Darwin, northern Australia
+ Joint venture partners include: INPEX(11.4%),
Eni(11.0%), JERA(6.1%) and Tokyo Gas(3.1%)
+ The plant commenced production in 2006 and has
delivered more than 650 cargoes to date
+ Gas is supplied from the offshore Bayu-Undan field
+ LNG volumes are currently sold via long-term contracts to
Tokyo Gas and JERA
+ Bayu-Undan end-of-field-life expected 2022 and Barossa is
the lead backfill candidate
+ Planning approvals are in place for an expansion up to
10 mtpa of LNG production
Santos Ltd 23
Bayu-Undan overview
Bayu-Undan is a mature gas-liquids project (ConocoPhillips operated56.9%, Santos11.5%)+ 2018 production:~40 mmboe (gross)
+ Pro-forma 2018 year-end 2P reserves: 108 mmboe (gross),
74 mmboe (net)
+ Capacity 600 mmscf/d
+ Gas-condensate field in Timor Sea
+ Timor-Leste Treaty Transition contains stabilisation of tax
and regulatory regimes
+ Developed by lean gas recycling with condensate and LPG
extraction in 2004, followed by export of lean gas to
Darwin LNG in 2006
+ Offshore facilities comprise:
+ CPP (Central Production and Processing complex)
+ FSO (Floating, Storage and Offloading facility), 2km
from the CPP
+ WP1– an unmanned platform 7kms east of CPP
+ 20 production wells (2 subsea) and 2 subsea water
injection wells
Santos Ltd 24
Barossa Project overview
Barossa project entered exclusive negotiations with the Darwin LNG JV for the supply of backfill gas
+ Material growth opportunity; pro-forma 2018 year-end 2C resource 799 mmboe (gross), 499 mmboe (net) Gas FPSO for processing
and condensate storage + Capex to first gas estimated to be~$4.7 billion (gross)
+ Utilising existing DLNG infrastructure delivers competitive upstream project and Future Development,
extends DLNG asset life
3wells subsea tieback
Subseamanifolds with
flowlines tied back to FPSO
+ Field Development Plan includes 9 subsea wells to be drilled in 2 phases, 6 in initial phase. Offshore condensate recovery and Export Pipeline tying into
Bayu-Undan pipeline to
export via FPSO
Darwin LNG
Six Phase 1 inclined Wells + Resource upside within Barossa and late life tiebacks present opportunity to extend development
+ Additional 2C resource associated with Caldita field located 20 km south of the
Barossa FPSO location
Santos Ltd 25
Greater Poseidon overview
40% operated position in a series of gas fields in the Browse Basin, 950km from Darwin+ Current ownership:40% ConocoPhillips (operator),40% Origin,
20% PetroChina
+ Pro-forma 2018 year-end 2C resource of 410 mmboe (gross),
164 mmboe (net)
+ 8 wells drilled in 2 campaigns in WA-315-P and WA-398-P since
2009 (Poseidon-1)
+ 7 discoveries in500m water depth, adjacent to Santos Crown-
Lasseter discoveries
+ No outstanding commitments
+ Lower Vulcan, Plover reservoirs at 4900-5000mSS, tested
at rates up to 34 mmscf/d, CGR 10-22 bbl/mmscf
+ Post 2025 dated development opportunity with Darwin LNG
expansion an option
+ Retention Licence application lodged September 2018
Santos Ltd 26
Disclaimer and important notice
Cautionary statement regarding reserve and resource estimates
This presentation contains forward looking statements that are subject to risk factors associated with the oil and gas industry. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a range of variables which could cause actual results or trends to differ materially, including but not limited to: price fluctuations, actual demand, currency fluctuations, geotechnical factors, drilling and production results, gas commercialisation, development progress, operating results, engineering estimates, reserve estimates, loss of market, industry competition, environmental risks, physical risks, legislative, fiscal and regulatory developments, economic and financial markets conditions in various countries, approvals and cost estimates.
Notes on reserves and resources statements
The estimates of petroleum reserves and contingent resources have been prepared in accordance with the 2007 Petroleum Resources Management System (PRMS) sponsored by the Society of Petroleum Engineers (SPE).
All estimates of petroleum reserves and contingent resources reported by Santos are prepared by, or under the supervision of, a qualified petroleum reserves and resources evaluator (QPRRE). Unless otherwise stated, references in this presentation to reserves (other than pro forma statements incorporating ConocoPhillips reserves) are as at 31 December 2018, as contained in the Santos 2018 Annual Report.
Information on petroleum reserves and contingent resources quoted in this reserves statement is rounded to the nearest whole number. Some totals may not add due to rounding.
Conversion factors: 1PJ of sales gas and ethane equals 171,937 boe; 1 tonne of LPG equals 8.458 boe, 1 barrel of condensate equals 0.935 boe; 1 barrel of crude oil equals 1 boe.
Unless otherwise stated, all references to petroleum reserve and contingent resource quantities in this presentation areSantos’net share. Reference points forSantos’ petroleum reserves and production are defined points withinSantos’ operations where normal exploration and production business ceases, and quantities of produced product are measured under defined conditions prior to custody transfer. Fuel, flare and vent consumed to the reference points are excluded. Petroleum reserves are aggregated by arithmetic summation by category and as a result, proved reserves may be a very conservative estimatedue to the portfolio effects of arithmetic summation. Petroleum reserves are typically prepared by deterministic methods with support from probabilistic methods.
Santos Ltd 27
Disclaimer and important notice
Cautionary statement regarding reserve and resource estimates
Notes on reserves and resources statements–Barossa
The estimates of petroleum reserves and contingent resources in the presentation are based on and fairly represent information and supporting documentation prepared by, or under the supervision of Mr Ian Pedler who is an employee of Santos and a member SPE. Mr Pedler meets the requirements of QPRRE as defined in Chapter 19 and rule 5.41 of the ASX Listing Rules and consents to the inclusion of this information in the form and context in which they appear in this presentation.
Notes on reserves statements–Bayu-Undan and Poseidon
Information on the reserves in this presentation relating to the Bayu-Undan and Poseidon assets is based on an independent assessment conducted by RISC Advisory as at 31 December 2018. The audit was carried out in accordance with the SPE Reserves Auditing Standards under the supervision of Mr Peter Stephenson, an employee of RISC Advisory and a member of the SPE and SPEE. Mr Stephenson meets the requirements of QPRRE as defined in Chapter 19 and rule 5.41 of the ASX Listing Rules and consents to the inclusion of this information in the form and context in which they appear in this presentation. Mr Stephenson is independent with respect to ConocoPhillips and Santos.
Santos Ltd 28