Santos weighing a A$2.5 bn bid for some of its Australian oil and gas fields
29 October 2015
Santos, Australia's largest domestic gas producer, is weighing a A$2.5-billion bid for some of its Australian oil and gas fields.
A week after rejecting a $7.1-billion takeover bid for the entire company from private equity-backed Scepter Partners for being too low and ''opportunistic'', Santos yesterday said that is ''strategic review is ongoing'' and all bids ''which deliver appropriate value and certainty for shareholders'' would be considered.
Quadrant Energy, which has a joint venture with Santos'in the Western Australia gas business, is said to have tabled a $1.5-billion bid for the 45 per cent stake it does not own, while Japanese trader Marubeni is mulling bidding $1 billion for a 3.6-per cent stake held by Santos in Exxon Mobil's Papua New Guinea liquefied natural gas plant.
Santos holds 13.5-per cent stake in the $19 billion PNG LNG plant, while US oil and gas giant Exxon Mobil holds 33.2 per cent and Oil Search Ltd. 29 per cent.
Founded in 1954, Adelaide-based Santos is one of the country's leading gas producers since the past 44 years and today is one of the largest producers of natural gas to the Australian domestic market. It also supplies natural gas to Asian customers.
Santos, whose stock has fallen by 23 per cent this year, currently has a market cap of A$6.6 billion and debt of $8.8 billion.
Santos is one of the leading independent oil and gas producers in the Asia-Pacific region, supplying energy to Australia and Asia. It supplies 9 per cent of South Korea's and 11 per cent of Malaysia's gas needs.
It wholly owns natural gas fields in Australia, Indonesia and Vietnam, and stake in a liquefied natural gas project in Papua New Guinea. It runs an LNG plant in Darwin and one more is expected to come up in the city of Gladstone.