Business Description:
Santos Limited (STO) operates in the exploration, development, production, transportation and marketing of hydrocarbons. Santos produces natural gas to Australian, Indonesian and other Asian markets. Santos has also developed oil and liquids businesses in Australia, Indonesia and Vietnam. Santos also focuses on transformational liquefied natural gas (LNG) strategy and has interests in four LNG projects in Australia.

Strategy Analysis:
Santos' vision is to become a leading South East Asian energy company via its portfolio of growth projects. Strategy centres on the Cooper Basin, Eastern Australian gas, Western Australian oil and gas, LNG projects and Asian growth. It is continuing to build South East Asian interests while undertaking high impact exploration and developing new projects to drive production and earnings growth. Santos reported NPAT of $504m for the half-year ended 30 June 2011, which is $306m higher than in 2010. This increase is primarily due to the $348m before tax gain on sale of non-current assets ($246m, NPAT) largely as a result of the sale of 15% of the GLNG project during the period, combined with lower production costs and exploration expense, and higher net finance income as interest associated with development projects was capitalised. Revenues from ordinary activities were $1.15bn, up 1% from the same period last year. Diluted EPS was 57.2 cents compared to 23.7 cents last year. Net operating cash flow was $681m compared to $537m last year. The interim dividend declared was 15 cents compared with 22 cents last year.