Sydney, January 22, 2026, 17:07 AEDT — After-hours
- Santos shares ended the day 5.28% higher, closing at A$6.38
- The first Darwin LNG cargo tied to Barossa is now loading for shipment to Japan; output is expected to rise in 2026
- Investors are now focused on commissioning progress ahead of the full-year results set for Feb. 18
Santos Ltd shares ended Thursday 5.28% higher, closing at A$6.38 after fluctuating between A$6.13 and A$6.42. Around 20.9 million shares changed hands.
The Australian oil and gas producer reported that the first cargo from the restarted Darwin LNG plant is currently being loaded for shipment to Japan’s Sakai terminal. It also projected increased production in 2026, driven by the ramp-up of the Barossa and Pikka oil projects in Alaska.
Citi analyst Tom Wallington said the loading might “allay investor concerns that more material issues emerged during commissioning.” The stock outperformed the broader S&P/ASX 200, which climbed 0.63%. Reuters
Santos forecasted 2026 production between 101 million and 111 million barrels of oil equivalent, a metric that consolidates gas and liquids into one oil-based figure. The company pumped 87.7 mmboe in 2025, while Visible Alpha’s consensus estimate stood at 108.5 mmboe.
The company posted a 9% sequential jump in fourth-quarter revenue, hitting $1.23 billion, buoyed by increased LNG and condensate sales volumes. However, year-on-year revenue took a hit as realised crude and LNG prices fell compared to the same period last year.
Santos reported Barossa gas exports hitting roughly 450 million standard cubic feet daily, roughly 75% of the plant’s capacity, as the BW Opal FPSO — a floating production, storage and offloading vessel — continued its start-up and commissioning phase.
Two connection failures on utilities and firewater mains GRE pipework systems triggered a campaign to reinforce similar connections, delaying the Barossa ramp-up schedule by roughly two months. “Santos now has a strong platform for production growth with Barossa’s first LNG cargo currently loading at Darwin,” CEO Kevin Gallagher said. pngx.com.pg
Pikka phase 1 stood at 98% completion by quarter-end and is still set for first oil late in Q1 2026, with production ramping up toward plateau around mid-year. Santos noted its portion of phase 1 capital expenditure has risen by roughly $200 million, citing higher costs for labour, materials, tariffs, and logistics.
The quarterly update highlighted roughly $380 million in free cash flow from operations for Q4 and around $1.8 billion for the entire year. Santos kept full-year unit production costs under $7 per barrel of oil equivalent, excluding Bayu Undan. Gearing stood at 26.8%.
Market patience now depends largely on Barossa overcoming its recent commissioning hiccup and Pikka starting first oil without pushing costs higher. Santos also revealed that Fluor has filed an appeal against a Queensland court ruling related to an earlier settlement, with a hearing set for July 2026.
Santos shares will next face a key test with full-year results scheduled for February 18. The company is set to hold an investor and analyst webcast at 11:00 a.m. AEDT, where the focus will likely be on the Barossa ramp-up and Pikka first oil progress.
