Transform Build Grow

Transform Build Shareholder Review Grow 2016

LNG tanker ‘Papua’, PNG LNG.

An Australian Inside energy pioneer Santos is an Australian natural gas company. Established 2 in 1954, the company is proud to deliver the economic Message from the Chairman and from the and environmental benefits of natural gas to homes and Managing Director and Chief Executive Officer businesses throughout Australia and Asia. 3 Five core long-life natural gas assets sit at the heart of a disciplined, focused strategy to drive Santos discovers first commercial Financial overview sustainable shareholder value: the Cooper Basin, GLNG, Papua New Guinea, Northern Australia hydrocarbon resource at Gidgealpa-2, and Western Australia Gas. Each of these core assets provide stable production, long-term in the Cooper Basin, 1963. revenue streams and significant upside opportunities. 4–5 Asset performance With one of the largest exploration and production acreages in Australia, a significant and growing footprint in Papua New Guinea and a strategic infrastructure position, Santos is well positioned to benefit from the growing global demand for energy. 6 The Santos turnaround is now well underway. A three phase strategy to Transform, Build and New three phase strategy Grow the business will drive returns as we continue to focus on the exploration, development, To download the Investing in Australian natural gas production and sale of natural gas. 2016 Annual Report please visit the Santos is focused on delivering sustainable shareholder value by becoming a low-cost, reliable Santos website: 7 and high performance business with the financial flexibility to build and grow the business Board of Directors through the oil price cycle. Santos Executive Committee www.santos.com Glossary

STAY INFORMED AND CUT DOWN ON WASTE Join over 50,000 Santos shareholders and make the switch to receive all your shareholder communications online at www.investorcentre.com 8 or contact Santos’ share registry provider, Computershare, on 1300 017 716 (within Australia) or +61 3 9938 4343 (outside Australia). Investor information Shareholder calendar 2 / Santos Shareholder Review 2016 Message from the Chairman and from the Managing Director and Chief Executive Officer

Dear Shareholder, Consistent with the company’s immediate This focus is not only driving improved focus to strengthen the balance sheet and 2016 was a year of transformational change performance and further productivity gains reduce net debt, the Board resolved not to for Santos. With the oil price trading at less but also providing a clear line-of-sight to pay a final dividend. Whilst we understand than US$30 per barrel at the start of the year, higher-margin growth opportunities and the that some shareholders will be disappointed, decisive action was taken to stabilise the delivery of Australia’s lowest-cost onshore it is our firm view that a disciplined focus on business and increase operating cash flow. operations. debt reduction is the most responsible course We enter 2017 with a The aim was to be free cash flow breakeven Our remaining assets are being run separately of action in the circumstances. With the “clear strategy, a new at US$35-40 per barrel on a portfolio basis. as a stand-alone business. Bruce Clement, strong progress being made in reducing costs The key strategic imperative was to create ex-CEO of AWE, has been appointed Vice leadership team and a and improving free cash flow, the Board is shareholder value by becoming a low-cost, President Asia, NSW and WA Oil Assets to confident in the company’s ability to return solid platform off which reliable, high performance business and manage these assets with a mid-tier oil and to paying dividends and will next review this we can build and grow. position Santos to deliver positive cash gas company mindset to maximise value. position at the 2017 half-year results. returns through the cycle. We are confident that we Under the Build phase we are building the SAFETY have the strategy, assets, A new leadership team with strong technical portfolio of development and exploration people and growth expertise was established. Stronger levels of The company recorded its lowest three-year opportunities across the five core long-life governance and central controls were also rolling average lost time injury frequency rate natural gas assets to maximise production, options to drive future implemented around key decision making and on record. It is a credit to all Santos employees drive down costs and increase gas supply. planning processes. A new operating model that they have stayed focused during the success, and deliver Future Growth will come from focussing was embraced to focus on our primary restructuring of the organisation and indeed shareholder value. on opportunities to increase production from business of exploration, development, have embraced a low-cost, high performance our core assets and an exploration strategy to production and sales of natural gas both mindset to re-establish Santos as a strong identify new high-value gas targets. onshore and offshore. and sustainable business with a proud history. In 2017 we will continue to refine our As a result of the changes implemented STRONGER BALANCE SHEET operating model and look to further improve by the Board and management, Santos Strengthening the balance sheet was a the asset mix and value drivers as well as build is beginning to turnaround. The free cash significant focus for the organisation in 2016. our capabilities and focus on a disciplined cost flow breakeven oil price was reduced from Net debt was reduced by US$1.3 billion to structure to drive more value out of our US$47 per barrel at the start of the year US$3.5 billion via a combination of assets assets. to US$36.50 per barrel by year-end. Santos sales, free cash flow and the successful generated US$370 million positive free cash completion of the A$1,040 million institutional BOARD RENEWAL flow over the last eight months of 2016 placement in December. The decision to raise In the first-half of the year we continued the resulting in a net US$206 million of free capital was not taken lightly. It was deemed process of Board renewal by acknowledging cash flow for the full-year, before asset sales. necessary to enable the company to operate the services of Ken Dean and Jane Hemstritch Whilst these results are pleasing and faster in a lower oil price environment and to provide who both retired from the Board and than anticipated, we recognise that there is the financial flexibility to build and grow the welcomed Peter Hearl and Guy Cowan as still more to do and we will continue to focus business in 2017 and beyond. Directors. Peter has over 30 years’ on sustainably driving costs out of the international business experience, including business in the coming year. We will continue to adopt a disciplined approach to capital management and will 18 years in the oil and gas industry with Exxon OPERATIONAL PERFORMANCE target a further US$1.5 billion reduction in Mobil. He is a director of Telstra Corporation and Treasury Wine Estates. Guy also has over Operations continued to perform well, net debt by the end of 2019 through free 30 years’ experience, including 25 years in the with annual sales volumes up 31% to a record cash flow, asset sales and monetisation of oil and gas industry with Shell and is Chairman 84.1 million barrels of oil equivalent (mmboe) infrastructure assets. of Queensland Sugar Limited. reflecting a ramp up in LNG from GLNG train US$447 million in proceeds from asset sales 1 and first LNG from train 2 in May 2016. were received in 2016, including the sale of These new appointments underscore Record annual production of 61.6 mmboe the Kipper asset offshore Victoria, Stag asset the Board renewal process with more than was also reported, up 7% on 2015. offshore Western Australia and pastoral half the Directors appointed within the last 3 years. A statutory net loss after tax, of US$1,047 holdings in the Cooper Basin. million was recorded which included after tax The sale of the company’s Gippsland and Thank you for your continued support for impairments of US$1,050 million on GLNG, Otway Basin assets offshore Victoria were Santos. We enter 2017 with a clear strategy, announced earlier in the year. The impairment announced in October and completed in early a new leadership team and a solid platform was due to the scaling back of activity in the January 2017, with proceeds of A$61 million off which we can build and grow. We are field in response to lower oil prices, which received. A A$118 million abandonment liability confident that we have the strategy, assets, impacted the ramp-up of production. was removed from the balance sheet upon people and growth options to drive future Combined with an increase in the price of completion. success and deliver shareholder value. third party gas, this resulted in the need to Sincerely, update long-term operating assumptions for In December 2016, we also entered into an the asset. agreement to sell our remaining 50% interest in the Mereenie oil and gas asset in the Excluding impairments and other significant Northern Territory for A$52 million. items, underlying net profit after tax was Completion is expected in the first quarter US$63 million, 29% higher than the prior year. of 2017. PETER COATES AO Excellent progress has been made over the NEW GROWTH STRATEGY Chairman past twelve months in sustainably taking costs out of the business and has contributed In December 2016 Santos announced a to a 51% reduction in capital expenditure to new three phase growth strategy to drive US$625 million and an 18% reduction in shareholder value – Transform, Build, Grow. upstream unit production costs to US$8.45 Under the Transform phase we have per barrel of oil equivalent. simplified the business to focus on five core KEVIN GALLAGHER long-life natural gas assets: Managing Director and In 2015 the Board announced a new dividend Chief Executive Officer framework to reflect Santos’ exposure to + Cooper Basin, oil-linked LNG pricing and the cyclical + GLNG, characteristics of global oil markets. This + Papua New Guinea, framework states that dividends are expected to be a minimum of 40 percent of underlying + Northern Australia, and net profit, subject to business conditions. + Western Australia Gas. Santos Shareholder Review 2016 / 3 Financial overview

SALES VOLUME PRODUCTION SALES REVENUE mmboe mmboe US$million

3,641

84.1 84.1 61.6 3¢483 2,594 3¢335

61.6 

mmboe 5  mmboe US$million

52.1 ¡ 1 63.7 64.3 51.0 2,5£ 61.3 58.5 2,442

2012 20132014 2015 2016 2012 20132014 2015 2016 2012 20132014 2015 2016

Record annual sales volume of 84.1 mmboe due to ramp-up Record annual production of 61.6 mmboe due to ramp-up Sales revenue up 6% due to higher gas and LNG volumes, of GLNG and strong performance from PNG LNG. of GLNG and strong performance from core 5 assets. offset by lower realised oil and LNG prices.

RECORD SALES VOLUME RECORD ANNUAL PRODUCTION SALES REVENUE BY PRODUCT mmboe mmboe US$million

Sales gas and ethane 30.0 Sales gas and ethane 897

LNG 19.3 LNG 887 Own product 64.0 Oil 7.8 Oil 575 Third party product 20.1 Condensate 3.3 Condensate 183

LPG 1.2 LPG 52

AVERAGE REALISED OIL PRICE CAPITAL EXPENDITURE OPERATING CASH FLOW US$ per barrel US$million US$million

117.8 116.4 103.4 46.4 625 857

1,¤¤ 1,633

4 031

¦§¨ 1 ¥ US$ barrel US$million US$million 3,278 3,300

53.8 46.4 811 8 ¦§

1,288 625 2012 20132014 2015 2016 2012 20132014 2015 2016 2012 20132014 2015 2016

Capital expenditure down 51% following the completion of Operating cash flow up 6%. Free cash flow breakeven the constructoin phase on the GLNG project and continued reduced to US$36.50 per barrel. focus on driving costs out of the business.

2016 FREE CASH FLOW (BEFORE ASSET SALES) 2016 Results BY MONTH US$million

2012 2013 2014 2015 2016 +US$206m 160 Sales volume mmboe 61.3 58.5 63.7 64.3 84.1 120 Production mmboe 52.1 51 54.1 57.7 61.6 Average realised oil price US$/bbl 117.8 116.4 103.4 53.8 46.4 80

Net profit after tax US$ million 537 499 -630 -1,953 -1,047 40 Underlying net profit after tax US$ million 627 489 523 49 63 0 Sales revenue US$ million 3,335 3,483 3,641 2,442 2,594 Operating cash flow US$ million 1,699 1,574 1,633 811 857 -40

1 EBITDAX US$ million 1,928 2,092 2,076 1,454 1,199 -80 Total assets US$ million 17,627 18,407 18,281 15,949 15,262 -120 Earnings per share US cents 56.2 51.6 -64.4 -169.5 -58.2 Dividends A cents/share 30 30 35 20 0 -160 Number of employees 3,289 3,502 3,636 2,946 2,366 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

1 EBITDAX (earnings before interest, tax, depreciation, depletion, exploration, evaluation and impairment), EBIT (earnings before interest and tax) and underlying profit are non-IFRS measures that Santos Free Cash Flow positive for each of the last 8 months are presented to provide an understanding of the performance of Santos’ operations. Underlying profit excludes the impacts of asset acquisitions, disposals and impairments, as well as items that are subject to significant variability from one period to the next including the effects of fair value adjustments and fluctuations in exchange rates. The non-IFRS financial information is unaudited, of the year. however, the numbers have been extracted from the audited financial statements. 4 / Santos Shareholder Review 2016

A disciplined, focused strategy to drive shareholder value now sees five core, long-life natural gas assets at the heart of our operations, each with significant upside potential. Our remaining non-core assets will be packaged and run separately to maximise value. Asset performance

Five core long-life natural gas assets

Cooper Basin GLNG Papua New Guinea Build production, invest in new technology to lower Build gas supply by drilling more wells to increase Strengthen our position by working with partners to development and exploration costs, and increase utilisation production as LNG markets improve, seek opportunities align interests, and support and participate in backfill of our infrastructure including the Moomba plant. to extract value from our infrastructure (pipeline and plant) and expansion opportunities at PNG LNG. and drive efficiencies to operate at lowest cost. 2016 in review

Delivering a low-cost, cash flow positive business. Transforming GLNG to deliver steady-state operations and Independent resource certification supports extended a cash flow positive business. Aiming to ramp-up GLNG LNG production at current plateau rates. Muruk discovery LNG sales from current levels to ~6mtpa over three years. (Santos 20%) appraisal underway.

Asset KPIs 2016 2015 Asset KPIs1 2016 2015 Asset KPIs 2016 2015 Production (mmboe) 15.1 15.5 Production (mmboe) 9.5 4.2 Production (mmboe) 11.9 11.4 Sales volume (mmboe) 23.5 20.8 Sales volume (mmboe) 19.8 5.5 Sales volume (mmboe) 11.8 10.9 Revenue (US$m) 768 851 Revenue (US$m) 540 123 Revenue (US$m) 444 566 Production cost (US$/boe) 10.7 12.7 Production cost (US$/boe) 6.4 8.6 Production cost (US$/boe) 4.6 5.3 EBITDAX (US$m) 265 293 EBITDAX (US$m) 183 31 EBITDAX (US$m) 350 443 Capex (US$m) 173 440 Capex (US$m) 228 406 Capex (US$m) 8 144

+ Cooper Basin cash flow positive in 2016 (+US$100m) + Train 2 start-up delivered to schedule in May 2016 + Excellent PNG LNG operating performance: ~8.3mtpa + Unit production cost down 15% to US$10.7/boe + Construction project completed and custody of entire annualised production rate in Q4 2016 compared to nameplate capacity of 6.9mtpa + Capex down 61% to US$173 million; 39 wells (up 26%) LNG plant received in October 2016 drilled with two rigs + Unit production cost down 26% to US$6.4/boe + EBITDAX lower due to lower oil prices + Gas well cost down 12% to US$4.2 million per well + Capex down 43% to US$228 million including + Expansion of PNG LNG likely and details evolving (drill, stimulate, complete) US$78 million on the LNG plant (complete) + Discussions continue on mechanism of incorporating + Forecast to drill 47 wells in 2017 with two rigs at + Drilling rig count increasing from 1 to 3 by Q217; P’nyang into PNG LNG US$3.2 million per well (drill, stimulate, complete) forecasting 130-150 wells in 2017 + Drilling and evaluation operations continuing on the + Raslie remediation progressing with positive results Muruk discovery

Rockhampton Emerald Blackwater Mount Morgan Queensland GLNG Gladstone Muruk Hides Mahalo South Australia Papua New Guinea Rolleston

Eromanga Queensland

Barikewa Ballera Arcadia Kumul Terminal Fairview Gayndah Innamincka Taroom Injune

Thargomindah Spring Gully Moomba Wandoan Scotia Roma PNG-LNG Plant

Roma Wallumbilla Mitchell Gas pipeline Miles Chinchilla Oil pipeline Port Moresby Gas pipeline Gas pipeline Santos acreage Oil pipeline 0 20 40 80 120 160 km GLNG acreage 0 2 0 40 80 120 160 km Santos acreage 0 30 60 120 180 240 km Santos acreage

1 GLNG Asset results include GLNG Joint Venture plus Santos’ share of Combabula, Ramyard, Spring Gully and Denison. Santos Shareholder Review 2016 / 5

Non-core assets

Northern Australia Western Australia Gas Support plans to progress Darwin LNG backfill Position Santos to grow production and market share in Packaged and run separately for value as a standalone opportunities, expand acreage footprint, and explore the WA domestic gas market. business. Portfolio to be continually optimised to and appraise the McArthur Basin. maximise value.

Extensive discovered resource to backfill and expand Low-cost operations with capacity and reserves to meet Non-core assets includes Indonesia, Vietnam, Malaysia, existing LNG infrastructure. Barossa appraisal drilling short and long-term demand. Bangladesh, Narrabri and WA Oil assets commenced with the first of two wells spudded.

Asset KPIs 2016 2015 Asset KPIs 2016 2015 Asset KPIs 2016 2015 Production (mmboe) 4.2 4.3 Production (mmboe) 8.9 9.4 Production (mmboe) 11.7 12.7 Sales volume (mmboe) 4.2 4.3 Sales volume (mmboe) 8.8 9.4 Sales volume (mmboe) 11.7 12.9 Revenue (US$m) 145 215 Revenue (US$m) 184 227 Revenue (US$m) 411 473 Production cost (US$/boe) 17.6 18.9 Production cost (US$/boe) 5.1 5.0 Production cost (US$/boe) 14.1 17.1 EBITDAX (US$m) 86 143 EBITDAX (US$m) 210 162 EBITDAX (US$m) 217 217 Capex (US$m) 14 30 Capex (US$m) 13 34 Capex (US$m) 50 44

+ Excellent DLNG operating performance + Production and sales slightly lower due to lower + Stag (WA Oil) sold in November 2016. Victoria and + EBITDAX lower due to lower oil prices customer nominations Mereenie sold with completion dates in 2017 + Barossa-Caldita being progressed as lead candidate + 2016 EBITDAX includes a one-off settlement under + Unit production cost down 18% to US$14.1/boe for DLNG backfill; first of two Barossa appraisal a revised gas sales agreement • Vietnam down 27% wells spudded + Resource build for long-term backfill supported by • WA Oil down 20% + Santos’ extensive discovered resource position includes successful near field discoveries at Davis and Spartan Crown-Lasseter (30%) and Petrel-Tern (35–40%) + Future projects include Varanus Island inlet compression and tieback of Spar-2 to increase gas deliverability

0 50 100 200 300 400km

Santos acreage Barossa Gas pipeline Caldita Oil pipeline Bayu-Undan

Bonaparte Basin

Darwin Petrel Frigate Crown Tern Lasseter Dampier Varanus Island Karratha Burnside

Browse Devil Creek Basin Western Australia

Western Australia Northern Territory Gas pipeline Oil pipeline

Onslow Santos acreage Non-core assets 0 15 30 60 90 120 km Exmouth 6 / Santos Shareholder Review 2016

Santos enters 2017 with a clear strategy, a new leadership team and a strong platform off which we can build and grow.

New three phase strategy

On joining Santos in February 2016, price environment and well positioned Kevin Gallagher, Managing Director to take advantage of rising commodity Transform and CEO, launched an in-depth asset prices in the future.” + New leadership team and simplified operating model to deliver a low-cost, review to identify both the issues and Twelve months on, the asset review is reliable and high performance business the opportunities across the company’s now complete. A new operating model portfolio, determined to develop a clear + Focus on five core long-life natural gas assets has been established, a management and focused strategy to restore and team with strong technical capabilities drive shareholder value. appointed and strong inroads made to Build In a letter to shareholders from the instil a low-cost, high performance + Identify and develop growth opportunities, including exploration, across the 2015 Shareholder Review, he stated: mindset. The company is now free cash five core long-life natural gas assets flow breakeven at a US$36.50 per barrel “My first priority and absolute focus oil price, and on 8 December 2016, a new + Maximise production, drive down costs and increase gas supply is to look closely at our operations. I am strategy to establish Santos as a low-cost, scrutinising our portfolio of assets and the reliable and high performance business was Grow structure and processes that we have in announced. This new strategy integrates place to manage them. I am working hard three concurrent phases to Transform, + Execute and bring on-line growth opportunities across the core portfolio to develop the right management team, Build and Grow the business. the right strategy and the right culture + Focused exploration strategy to identify new high-value gas targets to make Santos self-sustaining in a low oil + Find and unlock sixth core long-life natural gas asset

Investing in Australian natural gas

Gas facts

By investing in Santos you are investing in natural gas, which will play an important role in Australia’s economic, environmental and energy security future. Population growth and rapid urbanisation means the global demand for natural gas is forecast to grow by 50 per cent by 2040, overtaking coal for the first time in the global energy mix. Australian LNG will help meet this demand while Gas is good for Gas is good for Gas is good for creating jobs and economic benefits the environment the economy energy security for Australians. Switching from coal to natural gas Fact: Natural gas is between 50 and Fact: Australia’s oil, gas and energy Fact: Australia has enough gas for power generation also significantly 70% cleaner than coal when used for resources industry creates over 100,000 reserves to power our nation for reduces carbon emissions. This makes electricity generation. Australian jobs. The Australian oil and more than 500 years. gas industry has been operating for natural gas the perfect partner to Fact: The USA has done more than Fact: Natural gas is a perfect partner more than 50 years and has contributed transition to renewable energy, providing any country to reduce carbon emissions. for renewable energy sources. It’s more than $250 billion to the Australian a reliable source of energy that helps Switching from coal to natural gas and a reliable source of energy when the sun government. integrate intermittent renewable energy renewables for power generation has cut doesn’t shine or the wind doesn’t blow. sources into the grid. carbon emissions by 21% since 2005. Fact: Natural gas powers 40% of Fact: More than half of Australian Australia’s manufacturing industry. In uncertain economic times, a successful Fact: Australia’s LNG exports are homes rely on natural gas for heating, and well-regulated gas industry is critical forecast to reach 85 million tonnes per Fact: If every truck, digger, bus, ship cooking or hot water. to Australia’s future. Australia has the annum by 2020. If this LNG were used and train in Australia went gas-powered, Fact: Power stations that run on opportunity to create a world-class gas to replace coal-fired power generation, these energy users would save $1.3 natural gas are not only cleaner and industry, and as an Australian gas company, it would equate to a saving of more than billion in fuel costs and cut 1.7 million more efficient than coal-fired power Santos will be at the forefront of it. 50% of Australia’s annual greenhouse tonnes of CO emissions every year. 2 stations, they are also better at emissions, every year. responding to changes on the national grid. This means less blackouts and more capacity for wind and solar energy. Santos Shareholder Review 2016 / 7 Board of Directors

Full Director and Santos Executive Committee biographies are available on the Santos website:

www.santos.com

PETER COATES AO KEVIN GALLAGHER GUY COWAN HOCK GOH GREGORY MARTIN COMMITTEES OF THE BOARD Independent non-executive Managing Director & CEO Independent non-executive Independent non-executive Independent non-executive Audit and Risk Committee Director. Member of the Board Joined Santos in 2016. Director since 10 May 2016. Director since 22 October 2012. Director since 29 October 2009. Mr G Cowan (Chair) since March 2008, Chairman from Former CEO and Managing Chairman of Queensland Sugar Chairman of MEC Resources Ltd, Director of Spark Infrastructure, Mr H Goh December 2009 to May 2013, Director at Clough Limited. Limited. non-executive Director of Stora Deputy Chairman of the Board of Mr P Hearl reappointed Chairman April 2015 Kevin commenced his career as a Former Director of UGL Limited, Enso Oyj (Finland), non-executive Electricity Networks Corporation, Mr G Martin and appointed Executive Chairman Director of AB SKF (Sweden) and trading as Western Power, from August 2015 to January 2016. drilling engineer with Mobil North Coffey International and Ludowici Nomination Committee Sea, before joining Woodside in Limited and Shell appointed Vesuvius PLC (UK). Chairman of Iluka Resources Chairman of Santos Finance Ltd Limited, Chairman and Joint Mr P Coates (Chair) and Chair of the Nomination 1998. During his 13-year tenure alternative director of Woodside Former non-executive Director of Mr R Franklin with Woodside, Kevin led the between 1992 and 1995. BPH Energy Ltd, Operating Managing Partner of Prostar Committee. Capital and independent Mr G Martin Australian Oil Business Unit, east ROY FRANKLIN OBE Partner of Baird Capital Partners Non-executive Director of coast domestic gas plants and was Asia, and non-executive Director non-executive Chairman of Sydney People and Glencore plc, Event Hospitality & appointed CEO of the North West Independent non-executive of Xaloy Holding Inc. Desalination Plant Pty Ltd. Remuneration Committee Entertainment Limited (formerly Shelf Venture, Australia’s largest Director since 28 September 2006. Former MD and CEO of AGL, Mr G Martin (Chair) Amalgamated Holdings Ltd). PETER HEARL resource project. Chairman of Cuadrilla Resources Chief Executive Infrastructure Ms Y Allen Former non-executive Chairman of Holdings Limited, deputy Chairman Independent non-executive at Challenger Financial Services Mr R Franklin Xstrata Australia Pty Limited, YASMIN ALLEN of Statoil and Director of Amec Director since 10 May 2016. Group and MD of Murchison non-executive Director of Minara Environment, Health, Safety Independent non-executive Foster Wheeler plc. Non-executive Director of Telstra Metals Limited. Resources Limited, Chairman of and Sustainability Committee Director since 22 October 2014. Ltd and Treasury Wine Estates. Sphere Minerals, Chief Executive Former non-executive Director SCOTT SHEFFIELD With more than 20 years’ Mr R Franklin (Chair) of Xstrata Coal. and Chairman of Keller Group plc, Former non-executive Director of Independent non-executive Ms Y Allen experience in finance and Chief Executive Officer of Paladin Goodman Fielder Ltd. Past Chairman of the Minerals Director since 24 February 2014. Mr K Gallagher investment, Yasmin is a Director Resources plc and Group Council of Australia, the NSW Mr H Goh of Cochlear Limited and non- Managing Director of Clyde Executive Chairman of Pioneer Minerals Council and the Australian executive Director of ASX Limited. Petroleum plc. Natural Resources Company. Coal Association. Former non-executive Director of Serves on various industry and Insurance Australia Group Limited education-related boards, including and national Director and acting the National Petroleum Council and Chair of the Australian Institute of the Maguire Energy Institute of the Company Directors. SMU Cox School of Business. 2013 inductee into the Permian Basin Petroleum Museum Hall of Fame.

Santos Executive Committee Glossary Condensate A natural gas liquid that occurs in association with natural gas and is mainly composed of pentane and heavier hydrocarbon fractions. Free cash flow Cash flow from operating activities less cash flow from investing activities. Free cash flow breakeven The average annual oil price at which cash flow from operating activities equals cash flows from investing activities.

KEVIN GALLAGHER JOHN ANDERSON BRETT WOODS NAOMI JAMES LNG (Liquefied Natural Gas) Managing Director & CEO Executive Vice President Vice President Development Executive Vice President Natural gas that has been liquefied by refrigeration EHS & Governance to store or transport it. Generally, LNG comprises Joined Santos in 2016. Commercial & Business Joined Santos in 2013 and is Development mainly methane. Former CEO and Managing accountable for delivering projects, Joined Santos in 2016 and is Director at Clough Limited. Joined Santos in 1996 and is sustaining capital work programs accountable for legal, risk and LPG (Liquefied Petroleum Gas) accountable for commercial and and non-operated assets. audit, company secretary, Kevin commenced his career as a A mixture of light hydrocarbons derived from business development activities. environment and safety functions. drilling engineer with Mobil North Former Vice President, Eastern oil-bearing strata which is gaseous at normal Sea, before joining Woodside in Former Vice President Asia Australia, Brett joined Santos as Naomi previously held a range of temperatures but which has been liquefied by 1998. During his 13-year tenure Pacific, Western Australia and the Manager Exploration for the functional and line leadership roles refrigeration or pressure to store or transport it. company’s WA and NT Business with Arrium including Chief with Woodside, Kevin led the the Northern Territory, John has Generally, LPG comprises mainly propane and butane. Australian Oil Business Unit, east held a number of senior roles in Unit. Brett is a geologist and Executive of the Group’s coast domestic gas plants and was Santos including Vice President geophysicist, and has over non-integrated steel businesses, Lost-time injury frequency rate (LTIFR) appointed CEO of the North West Commercial, Vice President 20 years of oil and gas industry Chief Legal Officer and Chief A statistical measure of health and safety performance, Shelf Venture, Australia’s largest Strategic Projects and Group experience including executive Executive, Strategy. calculated by the number of hours worked. A lost-time management, technical and resource project. Executive Business Development. Naomi previously worked in private injury is a work-related injury or illness that results in a business development roles. ANTHONY NEILSON Prior to joining Santos, John practice at law firms in Australia person’s disability, or time lost from work of one day Chief Financial Officer worked for 10 years as a solicitor ANGUS JAFFRAY and the UK. shift or more. with a large corporate law firm Executive Vice President Joined Santos in 2016 and BILL OVENDEN in Brisbane and Melbourne. Strategy & Corporate Services Vice President Exploration Sales gas is accountable for the finance, Natural gas (methane) that has been processed by gas tax, treasury and investor VINCE SANTOSTEFANO Joined Santos in 2016 and is Joined Santos in 2002 and is relations functions. Chief Operations Officer accountable for strategy and accountable for developing and plant facilities and meets the required specifications corporate services functions. under gas sales agreements. Former CEO of Roc Oil Joined Santos in 2016 and is executing a targeted exploration Company Ltd, acquired by accountable for the profit and loss Angus has over 20 years of strategy. Train (LNG) Fosun International Ltd in 2014, of all our operated producing assets. leadership and consulting Bill is a geologist with over The infrastructure that purifies and cools natural gas to experience. and previously CFO of the Former Chief Operating Officer 30 years of experience in the oil a liquid state ready for transport. ASX-listed Roc Oil Company Ltd. at Woodside responsible for the Former Director of Azure and gas industry. He has worked Anthony has held commercial, company’s producing Business Consulting, a Partner at The on exploration projects in Australia, Units of measure finance and business services Units, the Production Function Boston Consulting Group where he Central and South-East Asia, bbl – barrel roles at Caltex Australia, Credit including 6 LNG trains with led the Australian Operations North Africa, the Middle East and Suisse First Boston (London) associated offshore infrastructure practice and a Supply Chain South America, with companies boe – barrel of oil equivalent and Arthur Andersen (Sydney). and four FPSOs, the Marine Division Manager with the global packaging including Sun Oil, Kufpec, mmboe – million barrels of oil equivalent and the Brownfields Projects group Crown Cork and Seal. ExxonMobil and Ampolex. Group. Vince has also engaged in mtpa – million tonnes per annum board work as a non-executive director and various management- consulting assignments 8 / Santos Shareholder Review 2016 Investor information

Santos Limited SHAREHOLDING ENQUIRIES ABN 80 007 550 923 Enquiries about shareholdings should be REGISTERED AND HEAD OFFICE directed to the Share Registrar: Ground Floor Santos Centre Computershare Investor Services Pty Ltd 60 Flinders Street Yarra Falls, 452 Johnston Street Adelaide SA 5000 Abbotsford VIC 3067 GPO Box 2455 GPO Box 2975 Adelaide SA 5001 Melbourne VIC 3001 Telephone: +61 8 8116 5000 Online enquiries: Facsimile: +61 8 8116 5050 www.investorcentre.com/contact Website: www.investorcentre.com/sto AUSTRALIAN SECURITIES Telephone: 1300 017 716 (within Australia) EXCHANGE LISTING + 61 3 9938 4343 (international) STO INVESTOR ENQUIRIES SANTOS WEBSITE Investor Relations, Santos Limited To view Annual Reports, shareholder and company GPO Box 2455 information, news announcements and presentations, Adelaide SA 5001 quarterly activities reports and historical information, Telephone: +61 8 8116 5000 please visit our website at www.santos.com Email: [email protected] 2016 ANNUAL REPORT Website: www.santos.com You can review our Annual Report online at UPDATE YOUR DETAILS ONLINE www.santos.com or request a printed copy To update your address, payment instructions, from the Share Registrar either by email at dividend reinvestment plan options, Tax File [email protected] or by Number, e-communications preferences, email telephone on 1300 017 716 (within Australia) address and more, please visit the Investor or +61 3 9938 4343. Centre at www.investorcentre.com/sto

Shareholder calendar

2016 Fourth Quarter Activities Report 20 Jan 2017 2016 Full year results announcement 17 Feb 2017 2017 First Quarter Activities Report 20 Apr 2017 Annual General Meeting 4 May 2017 2017 Second Quarter Activities Report 20 July 2017 2017 Half year results announcement 24 Aug 2017 2017 Third Quarter Activities Report 19 Oct 2017 2017 Fourth Quarter Activities Report 18 Jan 2018

All dates are indicative and subject to change. Designed and produced by www.twelvecreative.com.au by Designed and produced