South Australian oil and gas giant Santos is cutting 200 jobs, blaming a slowdown in “growth activities”.
The $25 billion ASX-listed manufacturer announced the cuts on Wednesday, with most of the affected roles concentrated in the company’s Perth office.
“A detailed review of the WA, Northern Territory and East Timor business units has been conducted over recent months to ensure our workforce is aligned with the business strategy and disciplined, low-cost business model,” the company said.
‘With a number of legacy assets close to closure, there is increasing focus on capital-intensive decommissioning activities in the short term.
‘Approval of new projects is taking longer, meaning that work programs are more sequential than in the past and some growth activities have been postponed.
“As a result, approximately 200 positions in the business unit have become redundant compared to our business activity plans, including contractors.
“The redundant positions are primarily based in Perth, with a small number based in other locations.”
Santos’ Port Bonython oil and gas site in South Australia. Image: Delivered / Santos
The company’s extensive portfolio includes oil and gas fields in the Cooper Basin, WA, the Northern Territory and Papua New Guinea in South Australia.
The company is also pursuing a number of growth projects, including the $5.7 billion Barossa gas project near Darwin in the Timor Sea, the $3 billion Dorado offshore oil development in WA and the Pikka oil project in Alaska’s North Slope.
But the company has faced complex regulatory hurdles and legal challenges over the proposed developments, including a protracted Barossa court battle.
Tiwi Islands Elsewhere took Santos to court over fears that underwater pipelines off Barossa would impact cultural heritage.
The Federal Court ruled in favor of Santos in January and the project is now more than 70 percent complete.
Santos said it had not taken the decision to cut jobs “lightly.”
“Santos recognizes that these types of changes are never easy for the people affected, 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 size to deliver 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.
CEO Kevin Gallagher said the Barossa and Pikka developments would shape the company for the next 10 to 15 years.
“Barossa and Pikka are world-class projects that will be transformative for Santos and provide the company with long-term stable cash flow for the next ten to fifteen years,” he said.
First gas in Barossa is expected in the third quarter of 2025, while first production in Pikka is planned for 2026.