Santos Ltd has announced deals to divest what it said were non-core assets onshore and offshore Australia to Comet Ridge Ltd and Eni SpA.
The Adelaide-based natural gas-focused producer said in an online statement it had already sold its 42.71 percent stake in the Petrel field and 100 percent interest in the Tern field, both offshore northern Australia, to partner Eni.
The sale to Italy’s state-backed Eni “reduced Santos’ future decommissioning exposure”, Santos said.
With Brisbane-based Comet Ridge, Santos penned an agreement to sell its 42.86 operating stake in the Mahalo Joint Venture in Queensland’s Bowen Basin. Comet Ridge would become the sole owner, already holding 57.14 percent.
Comet Ridge said separately, “By moving to hold 100 percent equity across all gas blocks in the Mahalo Gas Hub area, and by boosting our 2P + 2C reserve and resource base to over 670 PJ+, Comet Ridge will be able to optimize the development of the whole of the Mahalo gas resource”.
“The simplified ownership structure will allow Comet Ridge to ensure Mahalo does make a significant contribution to the east coast domestic gas market at a critical time”, Comet Ridge added.
“Santos has now taken the Mahalo Gas Project well into front-end engineering design, and we look forward to picking up that work in the first quarter of 2026 as we move towards a final investment decision on development”, it said.
Comet Ridge said the transaction would give it full ownership of two petroleum development leases that form stage 1 of the Mahalo Gas Project, three potential commercial areas (PCAs) to the south (PCAs 302-304), two petroleum lease applications to the northwest (PLAs 1128 and 1132) and three prospecting consents to the northeast (ATPs 2061, 2063 and 2072).
“[T]he Mahalo Gas Project interest acquired from Santos encompasses the ‘Shallows’ strata from surface down to the base of the Lower Mantuan Coal. Specifically, this comprises PLs 1082 and 1083 and PCAs 302 to 304”, Comet Ridge said. “The ‘Deeps’ will continue to be held 50:50 by Santos and Australia Pacific LNG Pty Ltd.
“There has been no new drilling activity in the Mahalo Deeps since the Lowesby 1 well was drilled in 1991”.
It said the full takeover would remove “complexities” from securing funding for the Mahalo Gas Project that have arisen from its lack of operatorship.
“Comet Ridge is in very productive discussions with multiple parties that give the company confidence it will fund the acquisition and set the platform for the development of the Mahalo Gas Hub on terms that create value for its shareholders”, Comet Ridge said.
Santos said the divestments demonstrate capital discipline, “monetizing pre-development assets that are not near-term priorities in our capital allocation framework”.
“Santos’ near-term priorities are to deliver Barossa and Pikka, and to progress the next phase of growth opportunities that leverage our existing operating footprint”, said Santos managing director and chief executive Kevin Gallagher.
To contact the author, email jov.onsat@rigzone.com
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