Key highlights

  • Santos Ltd (ASX:STO) shares were down 1.50% at $9.17 during the Trading session on 22 October 2026, while the S&P/ASX 200 Energy [XEJ] index was lower by 2.27%.
  • Santos reported record third-quarter production of 26.3 mmboe and record free Cash Flow from operations of about $1,069 million in its 22 October 2026 report.
  • Barossa achieved steady production, Pikka oil production briefly reached the minimum expected plateau rate, and sales Revenue was about $2,006 million.

During the trading session on 22 October 2026, Santos Ltd (ASX:STO) was priced at $9.17, down 1.50%. The S&P/ASX 200 Energy [XEJ] stood at 10,966.10 (−2.27%, −254.40 points) and the S&P/ASX 200 [XJO] at 8,789.50 (−0.47%, −41.80 points) at 12:40 pm GMT+11. In oil markets, crude prices climbed on Thursday after further Houthi attacks inside Saudi Arabia led the United States to instruct some diplomats and family members to depart its missions in the kingdom. Santos is an Australian oil and gas company with LNG, domestic gas and oil operations across Australia, Papua New Guinea and Alaska. The company released its third quarter report for the period ending 30 September 2026 on 22 October 2026, the same date, reporting record quarterly production of 26.3 mmboe.

About Santos Ltd: Business overview

Santos Limited explores for, develops, produces and sells natural gas, LNG and liquids. Its portfolio spans Australian domestic gas in the Cooper Basin, Queensland, New South Wales and Western Australia, the GLNG and Darwin LNG export facilities, the PNG LNG project in Papua New Guinea, the Barossa gas project offshore northern Australia and the Pikka oil project in Alaska. The company reports in US dollars and is based in Adelaide.

Third quarter 2026 production and cash flow

In its third quarter report dated 22 October 2026 for the period ending 30 September 2026, Santos reported record quarterly production of 26.3 mmboe, up almost 14% on the prior quarter and 23% on the prior corresponding period. Year-to-date production was 71.9 mmboe, almost 10% higher than the prior corresponding period, and sales volumes were 26.4 mmboe, an increase of 11% on the prior quarter.

Sales revenue was about $2,006 million, up 49% on the prior quarter and 78% on the prior corresponding period. Free cash flow from operations was a record of about $1,069 million for the quarter and about $1,447 million year to date, and free cash flow was about $957 million for the quarter, bringing year-to-date free cash flow to about $839 million.

Barossa, Pikka and base business operations

The report said Barossa achieved steady production during the quarter, with Darwin LNG operating at 98.5% reliability and ten LNG cargoes and two condensate cargoes lifted. Feed gas to Darwin LNG reached a record peak of about 600 mmscf per day.

At Pikka in Alaska, seawater injection commenced, the first oil cargo was lifted in August and five cargoes were lifted in the quarter, two carrying Santos Equity volumes. Oil production briefly reached the minimum expected plateau rate before the end of the quarter, was temporarily curtailed on two occasions and is planned to be held at around 70,000 barrels per day for a short period as part of a reservoir management plan. The report also referred to PNG LNG reliability of more than 98%, GLNG Upstream production of 697 TJ per day and Moomba carbon capture and storage having stored more than 2.5 million tonnes of CO2e.

Papua LNG, Greater Meridian and commercial agreements

Santos executed a binding agreement to acquire an additional 3.3% participating interest in the Papua LNG project from TotalEnergies, taking its interest to 21% after the State back-in, with completion conditional on regulatory approvals and the project reaching a final Investment decision planned for the fourth quarter of 2026. A Tier 1 Benefit-Sharing Agreement with landholders was signed in early October, and operatorship of the upstream project transferred to ExxonMobil after the quarter ended.

The GLNG joint venture partners entered binding agreements to acquire the Greater Meridian coal seam gas project in Queensland, with Santos acquiring a 30% interest and becoming operator, targeted for late 2026 subject to approvals. Santos also completed the divestment of its Mahalo joint venture interest for initial proceeds of about A$32 million, agreed key terms for a 10-year LNG Supply arrangement with POSCO, and signed a non-binding heads of agreement to purchase about 1 Mtpa of LNG from the proposed Ksi Lisims LNG project in Canada. Early results from the Jibera South 1 appraisal well in the Beetaloo sub-basin were also reported.

Related sector context

Oil and gas producers report Earnings that follow Commodity prices, production volumes, operating costs and the timing of development projects. On 22 October 2026, the S&P/ASX 200 Energy [XEJ] index was at 10,966.10, lower by 2.27%, while crude prices were reported higher on Middle East developments. The sector includes LNG exporters, domestic gas suppliers and offshore oil producers, whose revenue is linked in different ways to oil-indexed and domestic gas contracts, and whose Capital spending is typically concentrated in large projects with multi-year timelines.

Risks to weigh in

The quarterly report’s figures are unaudited operating and financial data, and production at newly started Assets such as Pikka and Barossa can be curtailed by weather, infrastructure issues or reservoir management decisions, as the report notes for Pikka. Completion of the Papua LNG interest increase and the Greater Meridian Acquisition depends on regulatory approvals and, for Papua LNG, a final investment decision. Oil and LNG prices, exchange rates, costs and the timing of project milestones all affect results, and commercial agreements that are non-binding may not proceed.

Catalysts on watch

  • Santos’s Papua LNG final investment decision, which the company plans for the fourth quarter of 2026.
  • Completion of the Papua LNG interest increase and the Greater Meridian transaction, targeted for late 2026.
  • Pikka’s production profile as water injection progresses, and further Barossa cargoes.
  • The company’s next results and any further LNG supply agreements.

Wrapping up

Santos’s 22 October 2026 third quarter report set out record production and free cash flow from operations, project progress at Pikka and Barossa, and a series of transactions and commercial agreements. Subsequent updates from the company will show how those milestones progress.