Santos Ltd Draws Global Interest Amid LNG Expansion Bid

Highlights

• Santos Ltd receives acquisition proposal led by ADNOC and consortium partners

• The company is active in major LNG projects including Gladstone, Darwin, and PNG LNG

• Santos is listed on ASX 50, ASX 100, and All Ordinaries indices

Santos Ltd (ASX:STO), a key energy player in the ASX 50, ASX 100, and All Ordinaries, operates in the oil and gas exploration and production sector. It maintains a strong presence across Australian liquefied natural gas (LNG) markets, including facilities in Queensland and the Northern Territory. The company’s portfolio includes operational assets as well as significant in undeveloped projects, with involvement in Papua New Guinea's LNG space being a noteworthy aspect.

Takeover Proposal From Global Consortium

A takeover proposal has been presented to Santos Ltd by an international consortium spearheaded by the Abu Dhabi National Oil Company (ADNOC), along with Abu Dhabi Development Company (ADQ) and Carlyle. The offer, still under negotiation, intends to secure exclusive due diligence access and aims to consolidate various LNG operations under a globally integrated gas business model.

The consortium plans to pursue due diligence on an exclusive basis before presenting a binding offer. The board of Santos indicated that should such a formal proposal emerge, it is inclined to support it, pending the absence of an alternative.

Strategic Significance of LNG Projects

Santos a vital stake in multiple LNG operations across Australia and Papua New Guinea. These include the Gladstone LNG and Darwin LNG operations, both significant to regional exports. Moreover, the company has equity interests in PNG LNG and the anticipated Papua LNG project, which are viewed as central to ongoing regional energy strategies.

The consortium’s focus is reportedly aligned with increasing global LNG supply chains, aiming to secure access to energy markets situated in Asia-Pacific. Santos’ LNG output last year reflected substantial contributions from its PNG operations, with the region viewed as a core supply base.

Additional Assets and Project Scope

Outside of LNG, Santos is progressing with an oil project in Alaska named Pikka, with expectations for production commencement in the coming years. This project adds geographic and resource diversity to the company’s portfolio.

The consortium’s leader, XRG—a new entity under ADNOC—has made other international acquisitions. These include gas projects in Turkmenistan and LNG interests in Mozambique, supporting the broader strategy of expanding global gas operations.

Regulatory and Board Perspectives

The Foreign Review Board, overseen by the Australian Treasurer, the authority to evaluate major foreign acquisition proposals. At this stage, there has been no public statement regarding regulatory leanings or anticipated timelines. The review process remains a key aspect in the outcome of the proposed acquisition.

The offer to Santos follows previous proposals from the same consortium, which were declined earlier this year. The company has now acknowledged that the latest terms are under review and may progress depending on regulatory pathways and further corporate deliberation.

Dividend Track Record and Shareholder Information

Santos Ltd is associated with asx dividend stocks, reflecting a dividend distribution profile relevant to market participants focusing on income returns. As a listed entity across several Australian indices, the stock forms part of various portfolios aligned with the broader australia share market.

Santos continues to maintain its upstream and LNG production activities while reviewing acquisition approaches and maintaining engagement with its shareholder base. The coming months are expected to focus on governance procedures, project execution, and corporate actions related to the consortium’s approach.