Santos is one of the largest and oldest Australian producers of oil and gas. Photo: Facebook / Santos Ltd
Papua New Guinea has expressed excitement about the prospect of Dubai-owned investment firms taking over Australian oil and gas giant Santos Limited.
Santos, one of the largest and oldest Australian producers of oil and gas, is facing a takeover by a consortium run by Dubai-owned XRG, with a bid of more than AUD$36 billion.
XRG is a subsidiary of the Abu Dhabi National Oil Company (Adnoc), which is owned by the state of Abu Dhabi, United Arab Emirates (UAE).
According to the Australian Financial Review, "Santos is a major Australian oil and gas company. Domestically, it is the second-biggest supplier of gas to Western Australia and has been a long-term operator of the Moomba gas processing hub in South Australia, a facility central to east coast gas supply for more than 50 years."
The firm has a footholding in the PNG Liquified Natural Gas (LNG) field across Hides, Juha and Angore, as well as the P'nyang field in the Western Province.
PNG's international trade minister Richard Maru told The National that the acquisiton represents a "major vote of confidence" in Papua New Guinea's economic potential.
"We have potential for more exploration and we need competition in the oil and gas sector, hence, this development is both timely and strategic," he was quoted as saying by the news outlet.
"However, while we welcome them, we must make sure that this transaction is in line with our national interest as per Section 277(6) of the Capital Market Act 2025."
Papua New Guinea Minister of National Planning, Richard Maru, in Wellington, 1 May 2018. Photo: RNZ / Johnny Blades
Maru said that the employment of Papua New Guineans, of which Santos currently employs around 700, according to a news report from 2023.
According to the Santos 2024 annual report, the firm generated $2.5b in revenue from PNG operations, and an EBITDAX (Earnings Before Interest, Taxes, Depreciation, Amortization, and Exploration) performance of around $2b.
For oil and LNG, Santos' PNG operations yielded the greatest production level (39.5 million barrels of oil equivalent) at the lowest cost ($6.47 per barrel of oil equivalent)
In terms of EBITDAX, PNG makes more than Santos' Australia and Timor Leste operations combined (about $1.7b).
Santos' assets in PNG also hold more proved plus probable reserves of gas (2,567 PJ) than their Australian and Timor Leste assets.
