Financial Analyst

Narrabri gas project two steps from approval: Santos CEO speaks at forum. Santos chief executive Kevin Gallagher, pictured during a visit to Narrabri in 2025, addressed a recent energy forum. Among his remarks on the day, Mr Gallagher made mention of the company's proposed Narrabri gas project. Oct 2, 2026 Santos chief executive Kevin Gallagher has told The Australian Energy Nation forum that the company is just two approvals away from proceeding with its Narrabri gas project. Mr Gallagher said the company is waiting on Native Title and a pipeline licence from the NSW government before it can proceed. He also warned proposed changes to Australia's domestic gas policy could put the economic viability of the Narrabri project at risk, despite the company remaining committed to developing the long-awaited project. "All we need now is that Native Title to the project, and then the pipeline licence from the New South Wales government, and we're ready to press the go button. But of course, what I would say is, it's a domestic-only project," he said. "We've committed 100 per cent of that gas to the domestic market, so the impacts of the domestic gas policy changes could have an impact on our ability to do that project if it drove the price of gas down below the price required to justify investment." Mr Gallagher said Santos would only proceed with Narrabri if the project could deliver an appropriate return on investment. "What I'm saying is that you would need a price setting for any investment to justify investment, so you get a return on that investment, depending on how it all shakes out," he said. "If that was to make the project not economic, then you wouldn't. I wouldn't ask my investors to invest in it. "Santos is not going to invest in projects that are not economic." Santos has previously committed to supplying all gas from the Narrabri project to the domestic market, with the company saying it could meet around half of NSW's gas supply needs. A Santos spokesperson said the company remained committed to developing the project. "Santos has consistently committed to developing the Narrabri gas project, which would be 100 per cent committed to the domestic market and meet around half of the gas supply needs of NSW," the spokesperson said. "As Santos CEO Kevin Gallagher noted, the domestic gas reservation policy in its current form risks crowding out domestic gas projects if it becomes uneconomic to develop them, and Narrabri is the only solution that could sustainably provide affordable, reliable gas to the east coast market in the coming decades." Mr Gallagher used his keynote address to argue that Australia should make greater use of its gas resources, saying the country's energy resources represented a major economic advantage. He said Australia had more than 240,000 petajoules of demonstrated gas resources, enough to continue producing at current rates for domestic and export markets for about 40 years. "We do not have a gas shortage," he told the forum. "We just need to get more gas out of the ground." Mr Gallagher said the oil and gas industry was also a major contributor to employment, government revenue and economic productivity, arguing that Australia should continue developing its existing energy resources while investing in new industries. "If we want to grow real wages for Australian workers, the first place to grow jobs is in oil and gas," he said. He said the industry had contributed about $105bn to the Australian economy in 2024-25, supported around 215,000 jobs and paid almost $22bn in taxes and royalties. The Narrabri gas project has been the subject of years of planning, environmental assessment and legal and regulatory processes. If developed, Santos says the project would provide a major new source of gas for the NSW and east coast domestic market.

Ksi Lisims hits lower end of pre-fid sales target with Santos deal. Ksi Lisims LNG has reached the lower end of the sales level its developer previously said it wanted before making a final investment decision, after Australia's Santos agreed to take another 1 million tonnes of LNG per year from the proposed British Columbia export project. The latest agreement brings announced Ksi Lisims offtake to 8 million tonnes per annum, or about 67% of its planned 12 mtpa capacity. Only 6 mtpa is currently covered by finalized sales and purchase agreements, while the remaining 2 mtpa is covered by preliminary agreements that still need to be converted into SPAs. Under the agreement announced Monday by Western LNG, Santos would purchase 1 mtpa from Ksi Lisims on a free-on-board basis for as long as 20 years. Santos expects supply to begin around 2031, according to Reuters. Ksi Lisims' binding offtake now consists of three 2 mtpa deals. Shell signed the project's first 20-year SPA, announced in January 2024. TotalEnergies followed with another 2 mtpa, 20-year agreement in May 2025 and separately acquired a 5% stake in Western LNG. Uniper became the third binding buyer in July, converting earlier negotiations into an SPA covering 2 mtpa for up to 20 years. Sponsored · Altamira Gold Corp. That gives the project 6 mtpa of contracted volumes, equal to half of its proposed capacity. Germany's state-owned SEFE adds another 1 mtpa under a Heads of Agreement signed in May, with deliveries expected in the early 2030s. Santos now adds a second 1 mtpa HOA. Together, the five announced buyers represent 8 mtpa, leaving 4 mtpa without a publicly announced buyer if Ksi Lisims intends to commercialize all 12 mtpa. Western LNG said Monday it expects to complete commercialization of the project's entire 12 mtpa capacity this year. The significance of the latest 1 mtpa becomes clearer against Western LNG's earlier commercialization target. After the SEFE agreement in May brought allocated volumes to 5 mtpa, Western LNG CEO Davis Thames told Reuters that Ksi Lisims was looking to secure another 3 million to 4 million tonnes of annual sales before reaching FID. That implied a pre-FID target of roughly 8 mtpa to 9 mtpa. Uniper subsequently added 2 mtpa under its July SPA, taking announced commitments to 7 mtpa. Santos now takes that figure to 8 mtpa, reaching the lower end of the range Thames identified in May. The project has not yet announced an investment decision, however, and the Santos and SEFE volumes remain preliminary rather than binding SPAs. Ksi Lisims is being developed by the Nisga'a Nation, Rockies LNG, and Western LNG as a 12 mtpa floating export facility on Nisga'a Nation-owned land in northwest British Columbia. The project received federal and provincial environmental approvals in September 2025 and was subsequently referred to Canada's Major Projects Office. British Columbia currently says an FID is expected in 2026, followed by construction beginning in 2027. The province estimates Ksi Lisims and the associated Prince Rupert Gas Transmission project together could attract about $30 billion in investment. For Santos, the Canadian agreement was announced alongside a separate 10-year LNG supply arrangement with South Korea's POSCO Steel beginning in 2030 or 2031. Santos said that supply will come from its broader global LNG portfolio rather than identifying Ksi Lisims as the source. Information for this briefing was found via the sources and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.