South Australian oil and gas giant Santos is cutting 200 jobs, blaming the cull on a delay in “growth activities”.
The $25 billion ASX-listed producer announced the reduction on Wednesday, with the most affected roles centered around the company’s Perth office.
“A detailed review of the WA, Northern Territory and East Timor business unit has been undertaken over recent months to ensure our workforce is aligned with the company’s disciplined, low-cost operating model and strategy. “the company said.
‘With some matured assets close to closure, there is growing short-term interest in capital-intensive decommissioning activities.
‘Approval of new projects is taking longer, meaning work programs are more sequenced than in the past and some growth activities have been delayed.
‘As a result, approximately 200 positions in the business unit exceed our business activity plans, including contractors.
“The surplus positions are mainly in Perth and a small number in other locations.”
Santos oil and gas site at Port Bonython in South Australia. Photo: Supplied / Santos
The company’s extensive portfolio includes oil and gas fields in the Cooper Basin, South Australia, WA, the Northern Territory and Papua New Guinea.
The company is also pursuing a number of growth projects, including the $5.7 billion Barossa gas project off Darwin in the Timor Sea, the $3 billion Dorado offshore oil development in WA and the Pikka on Alaska’s North Slope.
But the company has faced complex regulatory hurdles and legal challenges to its proposed developments, including a long-running court battle over the Barossa.
Tiwi Islands elders took Santos to court over fears the Barossa undersea pipelines could affect cultural heritage.
The Federal Court ruled in favor of Santos in January and the project is now more than 70 percent complete.
Santos said he had not made the decision to cut jobs “lightly.”
“Santos recognizes that changes like these are never easy for affected people, including their families, and we do not make these decisions lightly,” the company said.
‘Santos will support affected employees, including through our Employee Assistance Program and an outplacement service that provides career transition support.
“The company will continue to optimize its workforce to ensure it has the right capabilities and the right size to execute our business plans safely, efficiently and effectively.”
In its first quarter 2024 results, Santos reported $2.1 billion in sales revenue and 21.8 million barrels of oil equivalent.
Chief executive Kevin Gallagher said the Barossa and Pikka developments would set the company up for the next 10 to 15 years.
“Barossa and Pikka are world-class projects that will be transformative for Santos and will establish the company with stable long-term cash flows for at least the next 10 to 15 years,” he said.
First gas production in the Barossa is expected in the third quarter of 2025, while first production in Pikka is planned for 2026.