Santos Ltd Q2 2026 Update
Santos Ltd (ASX:STO) posted second‑quarter sales revenue of US$1.35 billion, representing a 5% increase over the same quarter last year but falling short of the Visible Alpha consensus estimate of US$1.57 billion. Quarterly production increased 3% quarter‑on‑quarter to 23.1 million barrels of oil equivalent (mmboe), while sales volumes declined 2% to 23.8 mmboe. In response, the company trimmed its full‑year 2026 production guidance to a range of 99‑105 mmboe, narrowed from the prior 101‑111 mmboe outlook, and revised its sales‑volume guidance to 102‑108 mmboe; the capital‑expenditure guidance remained unchanged.
The company attributed part of the operational disruption to Tropical Cyclone Narelle, which affected its Western Australia assets and the Cooper Basin earlier in the year, though production has since resumed across all impacted facilities. Chief Executive Officer Kevin Gallagher noted that the initial guidance reflected uncertainty around the commissioning of the Barossa and Pikka projects, but both are now progressing as expected. Barossa is operating at 97% of its planned rate, and the Pikka Phase 1 project in Alaska has entered continuous production, targeting a plateau output of approximately 80,000 barrels per day in the third quarter, with first sales revenue anticipated in August.
Realised commodity prices improved markedly during the quarter. Crude oil realised $120.33 per barrel, up from $71.17 a year earlier; realised condensate price rose to $112.11 per barrel; and realised LNG price increased to $11.21 per million British thermal units (mmBtu). The company expects stronger LNG pricing and cash flow in the third quarter.
Following the release, Santos shares slipped 1.5% to A$7.75, underperforming the broader S&P/ASX 200 index, which rose about 0.7% on the day.