Santos : 2021 Fourth Quarter Report

Fourth Quarter Report

For period ending 31 December 2021

ASX: STO | PNGX: STO | ADR: SSLZY

20 January 2022

only	Record annual production, record sales revenue and record free cash flow
• Strong base business performance delivered record annual production of 92.1 million barrels of oil
	equivalent (mmboe), inclusive of 1.7 mmboe from the Oil Search assets from 11 December 2021
• Stronger commodity prices and higher sales volumes delivered record quarterly sales revenue of
	US$1.5 billion, up 34 per cent, and record annual sales revenue of US$4.7 billion, up 39 per cent
• Free cash flow is expected to be around US$1.5 billion in 2021, more than double the level in 2020
•	GLNG delivered a record 6.4 million tonnes of LNG sales in 2021
	• Bayu-Undan delivered higher gross gas and liquids production in 2021, which enabled Darwin LNG to
		produce 3.2 million tonnes of LNG, almost all of which was sold at JKM spot prices
	• Santos' portfolio average realised LNG price increased by 32 per cent in the quarter to US$13.64/mmBtu
use	Disciplined and phased growth
• Barossa 20 per cent complete and progressing on schedule and budget
• FID on the Moomba carbon capture and storage project taken in November 2021, with first injection
	expected in 2024
•	Dorado Phase 1 and Pikka Phase 1 projects targeting FID in mid-2022 and first half 2022, respectively
	Merger with Oil Search completed

• On 10 December 2021, Santos announced the merger with Oil Search had become effective following approvals by Oil Search shareholders and the National Court of Papua New Guinea
• The merger created a company with strong and diversified cash flows, providing a platform to deliver shareholder returns and successfully navigate the transition to a lower carbon future
• Data in this report includes the Oil Search assets from 11 December 2021, unless otherwise stated

personalSantos Managing Director and Chief Executive Officer Kevin Gallagher said Santos delivered record annual production and sales revenue in 2021, as strong base business performance positioned the company to benefit from higher commodity prices.

Free cash flow of around US$1.5 billion for the year was also a record and more than double the level in 2020.

"Our disciplined, low-cost operating model continues to drive strong performance across the business and has positioned us to take full advantage of the increase in commodity prices. The completion of the Oil Search merger delivers us the size and scale to deliver even stronger outcomes in 2022 and beyond," Mr Gallagher said.

"I was particularly pleased that we were able to complete the merger before the end of 2021 and in just 130 days from

the announcement of our intent to merge with Oil Search, and this sets us up for what is going to be a very busy 2022.

"Consistent with our strategy, our next stage of growth will be disciplined and phased. The Barossa project is 20 per cent complete and making excellent progress, while I was delighted to announce the final investment decision on the ForMoomba carbon capture and storage project in November. The Dorado Phase 1 and Pikka Phase 1 projects are

progressing towards FID this year.

"Our merger with Oil Search delivers increased scale and capacity to drive a disciplined, low-cost operating model and unrivalled growth opportunities over the next decade - with a vision of becoming a global leader in the energy transition."

Comparative performance

Santos share	Unit	Q4 2021	Q3 2021	Change	2021	2020	Change
Production	mmboe	22.9	21.9	5%	92.1	89.0	4%
Sales volume	mmboe	26.0	24.4	7%	104.2	107.1	-3%
Sales revenue	$million	1,532	1,142	34%	4,714	3,387	39%
Capital expenditure1	$million	494	359	38%	1,387	858	62%

1 Capital expenditure including restoration expenditure but excluding capitalised interest.

Media enquiries	Investor enquiries	Santos Limited ABN 80 007 550 923
Claire Hammond	Andrew Nairn	GPO Box 2455, Adelaide SA 5001
[phone]	[phone] / [phone]	T [phone] F [phone]
[e-mail]	[e-mail]	www.santos.com

Sales volumes (Santos share including Oil Search from 11 December 2021)

	Product		Unit		Q4 2021	Q3 2021	Q4 2020	2021	2020
	LNG		000 t	1,107.9	1,055.2	1,382.2	4,555.6	4,278.8
	Domestic sales gas & ethane	PJ	62.5	65.1	76.5	257.7	275.1
	Crude oil	000 bbls	2,781.5	1,771.2	2,818.2	9,037.1	11,120.6
	Condensate	000 bbls	1,651.6	1,244.0	1,451.3	6,090.7	6,329.1
	LPG		000 t		50.5		29.0	73.9	211.6	235.7
	Sales
only	Own product	mmboe		21.3		18.7	25.6		83.3		87.6
use
	Third-party	mmboe	4.7	5.7	5.5	20.9	19.5
Total sales volume	mmboe	26.0	24.4	31.1	104.2	107.1

Fourth quarter sales volumes were higher than the prior quarter primarily due to inclusion of the Oil Search assets from 11 December 2021 (1.5 mmboe) combined with timing of crude oil liftings, partially offset by lower Cooper Basin third- party oil volumes.

Sales revenues (Santos share including Oil Search from 11 December 2021)

personal
Average realised prices (including Oil Search from 11 December 2021)
	Product	Unit		Q4 2021	Q3 2021	Q4 2020	2021	2020
	LNG price	US$/mmBtu					10.36	5.34				6.39
	13.64		9.25
	Domestic gas price	US$/GJ	5.19	4.98	3.97		4.86	3.88
For
East coast domestic	US$/GJ		6.31		5.50	4.15		5.62		4.51
West coast domestic	US$/GJ		4.61		4.72	3.67		4.48		3.33
	US$/bbl	86.32	76.64	46.76		76.11	47.70
	Crude oil price
	Condensate price	US$/bbl	80.91	72.17	45.82		70.08	40.50
	LPG price	US$/t	831.20	625.93	443.37		626.53	401.52

Product	Unit	Q4 2021	Q3 2021	Q4 2020	2021	2020
LNG	$million	791	574	388	2,213	1,437
Domestic sales gas & ethane	$million	324	324	303	1,252	1,068
Crude oil	$million	240	136	132	688	531
Condensate	$million	135	90	66	428	256
LPG	$million	42	18	33	133	95
Sales
Own product	$million	1,293	875	721	3,779	2,634
Third-party	$million	239	267	201	935	753
Total sales revenue	$million	1,532	1,142	922	4,714	3,387
Third-party purchase costs	$million	152	179	151	655	612

Fourth quarter sales revenues were a record and higher than the prior quarter reflecting inclusion of the Oil Search assets from 11 December 2021 (US$101 million) and improved commodity prices for all products.

The average realised LNG price was higher than the prior quarter reflecting the linkage of sales contracts to an improving lagged Japan Customs-cleared Crude (JCC) price and higher JKM spot prices. Three-month lagged JCC averaged US$73/bbl in the fourth quarter compared to US$67/bbl in the third quarter. Santos' LNG projects shipped 68 cargoes in the fourth quarter, of which 12 cargoes (Darwin LNG 11, PNG LNG 1) were sold at JKM spot prices.

Santos Ltd l Fourth Quarter Report l 20 January 2022

Page 2 of 13

92.1 mmboe

104.2 mmboe $835 million $553 million ~$7.80/boe ~$1.25 billion

90.4 mmboe

102.7 mmboe $819 million $510 million ~$7.80/boe ~$1.22 billion

88-91mmboe

100-105mmboe $800-900million $500-600million $7.70-8.00/boe $1.20-1.25billion

Updated guidance (incl. Oil Search)

Updated guidance (excl. Oil Search)

Previous guidance (excl. Oil Search)

Production by asset (Santos share including Oil Search from 11 December 2021)

only
Asset	Unit		Q4 2021	Q3 2021	Q4 2020	2021		2020
		Western Australia	mmboe	8.5	8.6	8.9	33.7		31.1
		Cooper Basin	mmboe		3.6	3.8	4.0	15.3		16.8
		Queensland & NSW	mmboe		3.5	3.5	3.4	13.7		13.4
		PNG	mmboe		4.9	3.2	3.3	14.2		13.2
		Northern Australia & Timor-Leste	mmboe		2.4	2.8	5.8	15.2		14.5
		Total production	mmboe	22.9	21.9	25.4	92.1		89.0
use
		Production by product (Santos share including Oil Search from 11 December 2021)
		Product	Unit		Q4 2021	Q3 2021	Q4 2020	2021		2020
		Sales gas to LNG plant	PJ	56.8	50.7	62.1	231.0		198.0
		Domestic sales gas & ethane	PJ	56.5	59.3	68.2	233.2		249.6
		Crude oil	000 bbls	1,938.5	1,531.1	1,136.2	5,876.8		5,093.3
personal	Condensate	000 bbls		1,175.1	1,150.0	1,505.6	5,069.1		5,460.6
LPG	000 t		45.4	48.1	61.3	202.8		220.9
Total production	mmboe	22.9	21.9	25.4	92.1		89.0

Fourth quarter production was higher than the prior quarter primarily due to inclusion of the Oil Search assets from 11 December 2021 (1.7 mmboe), partially offset by lower Cooper Basin volumes, a lower net entitlement under the Bayu- Undan Production Sharing Contract due to higher realised commodity prices and lower domestic gas volumes in Western Australia due to planned maintenance.

A data worksheet containing unaudited quarterly sales, revenue, production and capital expenditure tables in Excel f rmat is available on Santos' website.

2021 Guidance

2021 Guidance item

Production

Sales volumes

Capital expenditure - base

Capital expenditure - major growth

Upstream production costs

ForDepreciation, depletion and amortisation

Guidance on 2021 financial outcomes above is preliminary and subject to finalisation of the company's accounting and audit processes, and Board review. As such, actual results for the year ended 31 December 2021 may differ from the guidance given in this update.

Santos will announce its results for the year ended 31 December 2021 on 16 February 2022. The full-year report (incorporating Appendix 4E) and associated investor briefing presentation will be available on Santos' website at www.santos.com. A live webcast briefing, including analyst/investor questions, will be available on Santos' website from 11:30am AEDT on 16 February 2022.

2022 Guidance

Guidance for 2022 will be provided with the full-year results on 16 February 2022.

Santos Ltd l Fourth Quarter Report l 20 January 2022

Page 3 of 13

Western Australia

only	Santos share	Unit		Q4 2021	Q3 2021	Q4 2020	2021	2020
Sales volume
		Sales gas	PJ		40.5		42.4	48.3		168.7		158.8
		Condensate	000 bbls		380.2		302.3	368.0		1,312.1		1,393.8
		Crude oil	000 bbls	1,328.3	522.8	807.0	3,016.1	2,523.4
		Total sales volume	mmboe	8.6	8.1	9.4	33.2	31.1
		Total sales revenue	$million		337		262	233		1,099		723
		Production
		Sales gas	PJ	40.0	42.4	46.7	168.1	159.0
use	000 bbls		299.2		321.8	381.5		1,342.3		1,452.3
		Condensate
		Crude oil	000 bbls		1,265.1		1,005.2	497.5	3,510.0	2,448.6
		Total production	mmboe	8.5	8.6	8.9	33.7	31.1
		Capital expenditure	$million	80	102	82	316	171

Domestic gas production and sales were slightly lower than the previous quarter due to a planned maintenance shutdown at Varanus Island.

Tie-in and start-up activities for the two remaining dual lateral wells in the Van Gogh Phase 2 infill program were personalsuccessfully completed, ahead of schedule and under budget. WA oil production and sales were higher in the fourth

quarter due to incremental production from the wells.

The Varanus Island Compression and Spartan projects continued to make good progress in support of developing additional reserves back to Varanus Island. The Varanus Island Compression Project started up during the quarter. Pre- works activities commenced on the John Brookes Platform to tie-back Spartan and prepare for the first offshore campaign planned for early 2022.

The Dorado development has continued to progress with the planned FEED work for the FPSO and Wellhead Platform. The Stage 1 Offshore Project Proposal (OPP) phase has closed and the Stage 2 OPP submitted to NOPSEMA. The initial phase of development will involve gas reinjection to maximise liquids recovery ahead of a second phase of gas export from the field. This future phase of gas export offers backfill supply to Santos' existing domestic gas infrastructure in Western Australia. The project is targeting a final investment decision around mid-2022.

The Noble Tom Prosser rig is currently drilling the Dancer prospect, located seven kilometres from the Reindeer field. This will be followed by drilling the Pavo and Apus prospects in the Bedout Basin, located 35 to 40 kilometres east of the Dorado field.

For

Santos Ltd l Fourth Quarter Report l 20 January 2022

Page 4 of 13

Cooper Basin

only	Santos share	Unit	Q4 2021	Q3 2021	Q4 2020	2021	2020
Sales volume
	Sales gas and ethane1	PJ	15.5	17.0	17.1	67.5	72.4
	Condensate1	000 bbls	402.3	393.1	397.8	1,787.0	1,914.0
	LPG1		000 t	39.8	16.7	45.8	138.7	166.9
	Crude oil
		Own product	000 bbls	1,035.0	400.8	529.5	2,557.0	3,267.2
		Third-party	000 bbls	222.1	846.7	1,479.7	3,264.9	5,320.6
		Total	000 bbls	1,257.1	1,247.5	2,009.2	5,821.9	8,587.8
	Total sales volume	mmboe	4.6	4.6	5.7	20.2	24.2
	Total sales revenue	$million	253	206	199	925	847
	Production
	Sales gas and ethane	PJ	14.8	16.4	16.2	63.8	68.5
	Condensate	000 bbls	237.8	233.1	268.6	1,011.2	1,149.8
useLPG		000 t	33.5	33.8	36.7	138.0	150.3
	Crude oil	000 bbls	545.8	524.7	637.5	2,235.9	2,637.0
personal	Total production	mmboe	3.6	3.8	4.0	15.3	16.8
	Capital expenditure	$million	108	80	87	329	313

1 Sales volumes include own product and third-party volumes.

Cooper Basin production was slightly lower than the previous quarter due to natural field decline and higher gas downtime as a result of planned upstream events and unplanned train outages in the Moomba Plant. Oil production was stronger than the previous quarter due to new oil wells in Limestone Creek area and improvement in downhole well l sses.

Nineteen wells were drilled (14 gas wells and 5 oil wells), and 14 wells connected (9 gas wells and 5 oil wells) across the Cooper Basin in the fourth quarter.

The horizontal well program continued with the drilling of three oil and two gas horizontal wells. The horizontal oil wells were drilled in the McKinlay, Hobbes and Frostilicus fields. Of the two gas horizontal wells, one was drilled in the Moomba South field and the other in the Beanbush field which was drilling ahead.

In November, Santos took FID on the Moomba CCS Project after the Clean Energy Regulator registered the project with the Emissions Reduction Fund, enabling the project to generate Australian Carbon Credit Units (ACCUs). The project is now in the execute phase and will have the capacity to capture and permanently store 1.7 million tonnes of CO2 per annum, with first injection expected in 2024.

The Moomba CCS project is an important enabler for the production of hydrogen. Engineering, commercial and marketing studies are progressing on the Moomba hydrogen project with the goal of positioning the project as Australia's

Forlowest cost and one of the largest commercial hydrogen opportunities.

Santos Ltd l Fourth Quarter Report l 20 January 2022

Page 5 of 13