Santos, a leading energy company, has announced plans to reduce its workforce by around 10% as it transitions major growth projects into steady-state operations. Despite this restructuring, the company reported impressive financial results for 2025, including $1.8 billion in free cash flow and increased shareholder returns.
In its annual report, Santos revealed that it achieved a production of 87.7 million barrels of oil equivalent (mmboe) and sales volumes of 93.5 mmboe, generating $4.9 billion in revenue. The company also reported an underlying net profit after tax of $898 million. Free cash flow from operations reached $1.8 billion, driven by strong performance under its low-cost operating model.
The Board declared a final dividend of US 10.3 cents per share, bringing the total 2025 dividends to US 23.7 cents per share. Unit production costs decreased to $6.78 per boe, the lowest level in a decade. Gearing stood at 21.5% excluding leases, or 26.9% including leases, with strong liquidity.
As Santos’ major projects such as Barossa, Darwin LNG, and Pikka Phase 1 near full ramp-up, the company plans to reduce its workforce by 10% to align with the transition into the base portfolio. CEO Kevin Gallagher highlighted the success of the disciplined operating model introduced in 2016, which targets a sub-$35/bbl free cash flow break-even from operations.
Barossa and Darwin LNG were delivered within schedule and budget, with first cargo achieved in early 2026. Pikka Phase 1 in Alaska remains on track for first oil late in the first quarter of 2026. Santos also announced that Moomba CCS has stored over 1.5 million tonnes of CO2 equivalent since start-up and has achieved its 2030 emissions reduction target of 30% ahead of schedule.
Looking ahead to 2026, Santos maintains its guidance with production and sales volumes of 101–111 mmboe, capital expenditure of $1.95–$2.15 billion, and unit production costs between $6.95 and $7.45 per boe. The company aims to achieve an all-in free cash flow break-even oil price of $45–50 per barrel through 2030 while prioritizing shareholder returns and balance sheet discipline.
Overall, Santos’ strategic approach to managing its operations and projects has positioned the company for continued success in the energy sector. With a focus on efficiency and sustainability, Santos is well-equipped to navigate challenges and capitalize on opportunities in the evolving energy landscape.
