Australian natural gas company, Santos Limited (ASX: STO) has executed gas processing agreement extensions with Beach Energy and Senex Energy for gas processing and related gas-liquid purchases at its Moomba gas facilities which are located in South Australiaâs Cooper Basin.
Santos has been safely and sustainably developing oil and natural gas from the Cooper Basin for more than 50 years, and its Moomba gas facilities are a critical hub in eastern Australiaâs gas processing and transportation network. The extension of gas processing agreements with Senex Energy and Beach Energy has reaffirmed the strategic significance of Moomba gas plant which provides access to the east coast domestic gas market for other gas producers.
These extensions are expected to result in the production of up to 18 Terajoules of sales gas per day, or 20 Perajoules over the three-year term representing more than 1 percent of total east coast domestic gas demand as forecast by the ACCC (Australian Competition and Consumer Commission). In 2018, the company supplied around 70 Petajoules of natural gas to the east coast domestic market which was approximately 3% of the ACCCâs (Australian Competition and Consumer Commission) expected demand. Â By extending these gas processing agreements of Sensex and Beach, the company has taken a significant step forward in its strategy of leveraging its existing infrastructure to facilitate more gas supply in the east cost domestic market.
In October 2018, oil & gas exploration company, Real Energy Corporation Limited also executed binding agreements with Santos Limited for gas processing at Moomba, and gas transportation and tie-in at Mount Howitt. Further in November 2018, Santos took a major step forward in its strategy of becoming Australiaâs leading domestic natural gas supplier by completing the acquisition of Quadrant Energy for US$1.93 billion.
Today (i.e., 11 January 2019), the company also announced that it has extended its Cooper Basin crane operations contract with South Australian business Max Cranes. Max Cranes is a South Australian owned and managed crane provider, based in Port Augusta and as per the company Santosâ CEO Mr. Kevin Gallagher Max Cranes has been a very reliable and competent contractor in the Cooper Basin for years.
This contract extension is also essential for Max Crane as this partnership with Santos plays a crucial part in Max Craneâs organizational innovation. Further, this relationship with Santos also supports the employment of Max Craneâs highly skilled and dedicated workforce.
In the September quarter, Santosâ sales revenue increased by 10% to $973 million. As at 30 September 2018, the company had cash and cash equivalents of $1.8bn.
Meanwhile, in the last six months, the share price of STO declined by 7.58 percent as on 10 January 2019. STOâs shares traded at $5.840 (-0.171% intraday) with a market capitalization of circa $12.19 billion as on 11 January 2019 (AEST 4:00 PM).Â It has a 52-week high price of $7.480, with an average traded volume of nearly 6,345,163.
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