Santos completes 2.6% sale of PNG LNG to Kumul

Australia’s Santos has completed the sale of a 2.6% interest in the Papua New Guinea LNG (PNG LNG) Project to Kumul Petroleum Holdings Limited (Kumul).

The transaction, announced in March 2023, is part of Santos’ strategy to optimise its portfolio, and the net proceeds will be used to fund the company’s growth strategy.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said the completion of the sale is a significant milestone for the company.

“This transaction will allow us to focus our resources on our core assets and unlock value for our shareholders,” he said.

“We are pleased to have completed this sale to Kumul, which is a key stakeholder in the PNG LNG Project.

“We believe that the sale will benefit all parties involved and we look forward to continuing our strong relationship with Kumul and the PNG Government.”

Kumul is now the third-largest shareholder in PNG LNG, behind Santos and ExxonMobil.

The PNG LNG Project is a joint venture between Santos (37.6%), ExxonMobil (33.2%), Oil Search (22.3%), JX Nippon Oil & Gas (4.7%), Kumul (2.6%) and MRDC (0.1%).

The project is one of the largest LNG projects in the world, and has been producing LNG since 2014.

The sale of the 2.6% interest in the PNG LNG Project is expected to generate net proceeds of approximately US$180 million.

These proceeds will be used to fund Santos’ growth strategy, including the development of its Dorado project in Western Australia.