Santos Limited (STO) Earnings Call Transcript & Summary

Well. Good morning, everyone. It makes a bit tall for a short guy like me. Good morning, and welcome to Santos' Annual Investor Day. I draw everybody's attention -- well, I would have drawn everybody's attention to the last slide, but it moved, which is the disclaimer slide. Important that you all read that and study it very carefully. There might be some questions on it later on this morning. And if I move on to our acknowledgment of country, Santos acknowledges that we're meeting on the traditional land of the Gadigal people of the Eora Nation and that we pay our respects to elders, past and present. So I'll move on to the agenda slide this morning. We've got a busy morning ahead of us. Obviously, I've just welcomed everybody along this morning. I'm going to open with a review and operations update across the portfolio, talk about how the business is performing year-to-date and also a bit of a recap on the corporate strategy, the company's strategy before handing over to Sean Pitt, our Vice President of Marketing and Trading, who's going to take you across the markets and how they are looking and how Santos is positioned to maximize the opportunities out in the marketplace in the years ahead. And of course, how we're performing today across those markets. Then we'll have a morning coffee break before handing over to Sherry. Sherry, thrown in a deep end, I guess, once you're on salary Sherry, that's it. You're right in the deep end. A few weeks after starting with the company, and she's going to take you through capital management and finance overview. And of course, this morning, we're announcing a new capital allocation framework once Barossa and Pikka are online. It's something we've talked about for a long time that we're aiming towards. And so Sherry will take you through that and fill you in the detail of that and what that's going to look like going forward. And then we've got Brett Darley to give you some confidence and comfort that we're not going to have empty LNG plants in a few years' time. We've got plans in place, we're working with our joint venture partners on backfill strategies around that portfolio. And I just show you just how strong that portfolio is and some great news there. You probably saw this morning in our release that the Angore wells are on stream and we'll talk a bit about that today, and that's been a long time coming, but that's a great delivery for this year, a very big development project, over USD 1 billion, bringing Angore back on and currently producing around 350 million scuffs per day and backing out production in PNG. So we're now having to shut in some of the production that we've been producing all year long. So that's a really good development up in PNG. And then Alan is going to cover the Energy Solutions. And of course, Alan's on a bit of a high, he's got the Moomba CCS Phase 1 project online and working as designed to work. So it's delivering what it promised to deliver in terms of the capture of the storage. And he'll talk about his new carbon capture growth targets that we're announcing today as well and what that means in terms of equivalents of Scope 3 emissions targets for Santos. And then we'll have some question-and-answer session at the end. We'll take some Q&A. And I've been asked to remind everybody in the room, 2 questions only, please. There's a lot of people in the room, and we know there'll be a lot of interest. So we are going to limit it to 2 questions. And so that will be a very hard drill apparently that we're going to enforce around the room. So pick your best to your questions. Go over the best first, so the hardest first, as I say, and we'll see what we can do to make sure we address your inquiries. All right. Let's kick right off into the portfolio update. And if we can, I'll start with the next slide, please. I always like to start with our safety performance, personal safety and process safety. And what's really improved or important to us, as I set out back in 2016 to build a reputation for Santos as a reliable and safe operator. One of the questions, [ marks ], you would have had back then was really what we're known for the Cooper Basin. We're really known beyond the Cooper Basin. It was building that brand as a safe and reliable operator, given that we're then venturing to new LNG plants like at Gladstone. And of course, our plans even back then, although it wasn't public, was, of course, to be able to leverage off of that foothold and buy the operatorship in Darwin and build a much more significant operating footprint. And so building that brand is really important. And safety, of course, is a big part of that process safety and personal safety. And it's been really good to see the improvement in all metrics across our safety performance, and particularly since COVID because we saw that the entire world slipped back during COVID, whether that was distraction, whether it was stress, many, many factors, people working away from home from long periods of time, the isolation, they had to go into and the quarantine, they had to go into and the way to work and the way home from work. All of that had an impact on people's mental health and resilience, and we saw safety performance deteriorate globally. And you can see that our performance has really come back on track, and it's continuing to improve year-on-year. And a big shout out to a lot of the people across our organization who are really driving high standards there. Steve Trench, Megan Rivers, the guys that are really putting out every day to drive that safety culture across Santos globally. The majority of the incidents, you can see that we have now are with contractors. And so contractor management is a big focus for us. Ironically, for Santos, one of the biggest risks we have in our portfolio is driving incidents because we drive -- I can't remember how many times it is now that our people go around the earth annually in terms of total kilometers drive, but it's an incredible amount when you think of our operations across the vast Cooper Basin, Queensland, PNG, and even in Alaska and the North Slope, a lot of that is on land, and it requires people traveling large distances every day to do their work. That's a big exposure for us. So a real focus on motor vehicle safety. And to have these safety numbers and the performance trends is really pleasing. A couple of big things we did this year. As always, we have an annual stand together for safety event where we shut down our operations all over the world for an hour or 2 at the same time on the same day anyway. And we focus on safety. And we work with the crews, and we engage with the crews to find out what we can be doing better. And of course, to communicate what our expectations of all of our workforces are. We do that once every year, and we did it in November this year. And we've also rolled out a new safety behavior expectations program. And that's a program that we've rolled out every Santos operation anywhere on the planet to drive that standard approach to continue to drive that improvement in our safety. On process safety, the key metric that we use the primary metric, if you like, for process safety is loss of containment incidents. The key focus of process safety is keeping stuff in the pipe, keeping in the system, not having leaks, not having gas leaks or releases. And you can see there that is a continual battle, particularly when you've got aging infrastructure like in the Cooper Basin and in PNG, to say its vintage would be a bit of a an understatement, a lot of equipment, we're working on these assets. So keeping that safe is a huge, huge effort. And Brett will talk a little bit about what that means in terms of cost and where his focus is going forward, which should not only result in very significant cost reductions across the Cooper Basin but also safety improvements. And you can -- but is pleasing to see that continual drive down in process safety releases. In terms of how our business is set up, if I move to the next slide, I thought it was worth starting an overview by just reminding people how we've set the business up or informing you if this is new to you. But effectively, you've got to think of our business as 3 businesses. We think of our business as 3 different businesses. We've got our LNG portfolio with some world-class LNG assets in PNG, Gladstone and Darwin, all in a nice little triangle very, very close to our markets. One of the big competitive advantages of this LNG portfolio is our shipping times -- our shipping distances to our clients. And you got to think of that in terms of cost of shipping advantage, but also emissions. Every day, cargoes at sea, it normally loses about 0.1%, of 0.1%, I should say, methane to the atmosphere as boil off gas. And so when you think about 20-odd days coming from the U.S., 23 days, I think it is from the Middle East, that's our competition. So over the life, a 20-, 25-year life of an LNG facility, that is very significant Scope 3 emissions advantage that our LNG portfolio has over the competition. Sean will talk about that later on. And then we've got our integrated oil and gas, our traditional conventional oil and gas businesses. These are not linked to LNG facilities, and that's both in Alaska and Western Australia. And then, of course, got our SES assets, which if you think of those predominantly as the 3 CCS hubs that Alan will talk about later on. So I thought it was worth just talking about those. And of course, we got to mention the Santos Foundation that does some amazing work in PNG, but also now in Australia. The foundation is spreading their wings. And that's the charitable arm of the company, if you want to think of that way. There's a lot of really good work on the company's behalf and communities. And one of the great things that the foundation does is it leverages off of the sponsorship and donations that come from Santos to get funding from other entities. And we've had other companies funding projects alongside us in PNG, but also now in Australia coming in and want to participate in the foundation. I will go to the next slide, please, and I'm going to run around these pretty quickly. I think is some of the major highlights around the portfolio in PNG, 79 cargoes delivered to the end of October on track to deliver just short of 100 cargoes for the year. We completed the sell-down of our 2.6% interest to PNG LNG project to Kutubu. And I know that was a long time happening, but we got there in the end. Patience is a virtue as they say. Strong production this year through PNG and on plan, really supported by the Santos operated assets in PNG. And I'll talk about that in a minute, the reliability and how we were able to do that, where we were putting in around 250 million standard cubic feet of gas per day from our own operated fields to keep the production at PNG LNG up throughout the year. And that's been up quite significantly on our production -- Santos operated production at the same time last year. And 20% -- but that equates to 21% of the PNG LNG supply this year coming from Santos operated gas in PNG. And we couldn't have done that without that strong process safety and that strong operating culture. And I'll show you that in the next slide in a minute. Stay on this slide, please. That wasn't a hem to move to the next slide. On the East Coast LNG business. And we refer to Gladstone as the sort of plant that leads up our East Coast LNG team, because we supply gas, of course, from 3 different supply sources. We've got our GLNG project equity gas, which now makes up 62% of GLNG feedstock and then, of course, we've got Santos's equity gas, which now makes up 15% of the gas going into GLNG and only just over 20% of the gas now is relying on third-party contracted gas. And that's -- you'll remember when GLNG came on stream back in 2015 -- 2016 when it came on stream, that was almost 60% third-party reliant on third-party gas, 60% of the feedstock back then. And when you take the Cooper Basin gas plus that 60%, it was very small JV equity gas. So we've been building that year-on-year, and that's a real success story and a real testament to the work the guys are doing to get those well costs down over the years. We've delivered 80 cargoes year-to-date in GLNG. And between Cooper Basin and our CSG operations this year on track to deliver around 330 wells for the year. And of course, DLNG is shut down. We are still producing some gas in the northern territory domestic market from Bayu-Undan. So we've been able to keep squeezing that and getting some gas out. We struck a deal with PWC in the northern territory to supply them gas -- much needed gas on commercial terms. And so DLNG is still -- it's expensive gas because the volumes are low, but it's not going through the plant. This is going straight into the market. As I said, Darwin shut down -- the Darwin life extension project is now 67% complete and due to be onstream ahead of Barossa starting up in Q3 next year. I think that's due to be onstream in the second quarter. And of course, the Barossa project is now just around 84% complete as at the end of October and progressing well. If I run through the assets in PNG on the operational, the next slide, please -- the call-out, really, a lot of this I've already covered. I think the call-outs on the reliability. Now this is the reliability of the Santos operated assets in PNG. And what I'd like to -- without bagging the past. That's not the point of this chart. It's not about bagging anybody in the past, but this is what it used to be. This is the reliability. And think of that 17% at the time it wasn't available, wasn't reliable. It was shutting down for maintenance or whatever, right? And applying our process safety and our maintenance approach across these assets. Year-to-date, we've been driving that at 97%. So 97% at the time we're having these facilities onstream. What that means is a very significant upside production potential over the course of 12 months. And that's why we put so much effort into maintenance and so much effort into reliability of our assets to get that extra production, that extra availability through them. That's allowed us to supply 21% of the feedstock gas at PNG LNG from Santos operated assets in 2024. And that's allowed us to keep the production higher than maybe you would have expected it to be otherwise. I think other notable highlights. The big news is the Angore project is online and producing at 350 million standard cubic feet per day. That's a TCF prospect we've developed, Exxon operating. And importantly, with that project, I think, it's producing at those rates. One of the wells is on a 30% [ short ]. And I think the other one is about 50% or something. So there's a lot of resource here. We won't know if there's an upside outcome here for probably 6 to 9 months. We've got to let it produce for a well because it's such a big, big play that you really need to let it produce for a well to understand if there's any sort of EUR upside or anything like that. In addition to Angore, we're currently drilling the Hides Footwall well. That's another very prospective opportunity. Brett might talk a little bit about that in his section so I won't steal his thunder. Angore, I've summarized here. So we will just keep moving. Please go to GLNG. On GLNG, as usual, we think of that as an upstream drill complete Connect asset. And so we're getting as efficient at that factory style manufacturing process of drilling, completing and connecting wells as we can. And so we talk about the number of wells per year. We'll look at how many wells we're drilling each year to keep driving that up. Production and unit cost is really important to us. And of course, we'll look at the drill complete connect performance. And you can see that the CapEx we're spending every year. We get how many wells, we are getting for that CapEx. That's really important to us to keep that metric alive. I think in terms of the highlights, some of the technical highlights for this year, at Fairview. It's started growing production again this year. That was the first thing that's happened a long time, actually seeing that bottom out and come back up. So that was good news. Roma well costs continuing to be driven down. And that's particularly important given that we're drilling deeper wells out in the flanks at Roma now. So I think they're about 35% deeper, and we're doing that extra depth in about a day. So it's taking about an extra day to drill some of those deeper wells, but the efficiency and the unit cost per well is right on track. We want to be continuing to perform over time. Our CSG productions continue to climb. And that's why we're now at the rates we are, as you saw on that first slide in terms of percentage of the feedstock. We continue to build that supply from our indigenous production. What's really important to recognize about the CSG wells is that the tails are very strong. It's [ hard yakka ]. These are [ hard yakka ] assets. You can't take your foot off the pedal for 5 minutes. You've got to keep getting better drilling, you've got to keep drilling hundreds of wells every year. You've got to keep on top of your cost. It's just an efficiency game. It's about being efficient and reliable and consistent. But what is also important to recognize is once you do that hard work, I think later this decade, we sort of drill up most of our feedstock as to recognize how strong the tails are on these wells, very strong tails. And even though we stopped drilling, I don't know, predominantly around the 2030 market, whatever it is, you will see as far out as 2045 even with natural decline and doing nothing else, you're still filling one train in 2045. So it's really strong tails from CSG, just like the U.S. Shale. You've got to keep drilling and replacing the client to stay at your capacity or to flatline your performance or to grow it. But once you stop, the tails are very strong for a very long time, and it becomes more of a workover type focused operation. If we go to the Cooper Basin, Cooper Basin another [ hard yakka ] asset, right? It never gets easier year-on-year in the Cooper. But some great stuff over the last few years, we've been spending a lot of effort and appraising new opportunities. We want to redefine the Cooper Basin, want to reshape the Cooper Basin because it's just too hard to keep doing what we've been doing forever. And so there's been a lot of work on some electrification, some automation, digitization. There's many wells now that we can operate from the control centers in Brisbane, like the CSG wells in Queensland. So we're taking people out of the field, and we can start wells up and shut them down remotely. And of course, the Cooper Basin was never like that. It's a very, very old asset from sort of 60 years ago, right? So a lot of the equipment was from 60 years ago, still is from 60 years ago. In fact, when we used to do our cybersecurity assessment, the Cooper Basin is always the safest asset we had across the portfolio because it was so old that cybersecurity wasn't an issue for it. It wasn't connected to anything. That's changing as we modernize and we improve the technologies out in the Cooper Basin. What's interesting with the Cooper is you've got to recognize the Cooper Basin, 90% of the gas goes to GLNG. It's a GLNG asset. It's an LNG asset for us, has been now since 2016 and only 10% of that gas was in the domestic market. We're on track to drill over 100 wells. I think about 105, 106 wells for the year. We've now bottomed out that decline you saw during COVID when the drill rates dropped. So we bottomed that out and is now start -- just start to nudge up again. And so if we can keep the well rate up over the next few years, we should start to see production building back up. The Cooper Basin is simply -- the name of the game there is how many wells you're drilling each year. How many wells are you drilling each year? And Brett will talk about how that converts resource to reserves and all that sort of stuff over the years. But the story is the same year-on-year. volume, work unit costs go up when the production goes down, when the production goes up, the unit costs go down. So it's actually about maintaining production. And we've learned that lesson many times over 60 years. And so hopefully, we're not going to keep learning that message. And Brett's got a great story to tell about what we're doing there. Ongoing success in our horizontal wells in the Granite Wash, some big wells there. In fact, one came on at just around 9 million scuffs per day earlier this year or late last year. And I think it's still producing over 2%, 2.1%, 2.5%, something like that millions scuffs per day today. So again, a really good feel for those type curves. The fracking technologies we've been trialing out there, Brett talked about that today and what that's unlocking for us but also the work we've been doing with some of our major providers to develop drilling tools that can drill in rock temperatures up to 200 degrees C. So we've got areas of our field now we couldn't drill only a few years ago. The technology didn't exist to do that. And we've been testing technology over the last 3 years or so and now we're able to land, drill and land these horizontal wells in these areas that we're written off effectively in the past because we just couldn't access them. That's unlocking significant new resource. We've had very good successful wells here, and that's now unlocking these resources, and Brett will talk about his development plans there. And the good news -- I don't want to steal too much of Brett's thunder, but you can just reemphasize it perhaps Brett. But the good news about a lot of the stuff in the Cooper that Brett is focused on the high-value stuff, it's central. It's in the center. It's near Moomba, and that's really important from an infrastructure and a cost perspective. If I move on to the next one, in terms -- we give some project updates. Obviously, on the LNG projects. We've got the Barossa project. You probably -- this is the one that we report the most on. Of course, if I think back to a year ago, the project had stalled. We had some a activity that was holding us up. Thankfully, we got through that. We've moved forward. That's all I'm going to say in that issue today. And we are progressing the project, 84% complete. And we are a 50% partner in that very significant resource and reserves position on that project. The reservoir results have been very encouraging from the 3 wells that we've now drilled through the reservoir, we've gone back to the one. You'll remember there's one well which suspended above reservoir for logistics and SIMOPs purposes. We'll now go back and drilled through that reservoir and the reservoir results there are slightly better than expected as well. So we're getting really positive consistent results across this field. And I've always said, good projects get better with time. Good fields get better. And I think we're beginning to see a bit of that coming through in Barossa. The FPSO facility is progressing well. I think some of you have probably visited that over the course of the last year or so, and I think we've got some people going out in the next week or so as well to visit it. You're going to see a very large FPSO. So I think it's the biggest FPSO in the world outside of the floating LNG facility that Shale has at Crux. It's a massive facility. It's like we've got a green processing plant. Now before you get too excited about what that means, it's painted green. It's just very green. That's not. It doesn't mean anything. I don't want to get sued for using the term green processing facility. It's just painted green because BW our operator, their colors are green. Santos, is blue, they're green. It's not like Celtic and Rangers back in Scotland although hopefully a better rivalry -- not a rivalry a partnership, a partnership, I should say, with BW for many years to come. So the wells are progressing well. The drilling out there is tough. We've had some drilling problems in the intermediate section. We knew that it's the biggest drilling risk that we had, and it's a cost and time issue as opposed to a well productivity issue. But we've had a few stumbles getting through those, but we're getting across it. We're getting through it. We've got 3 wells now landed, drilled at 1 reservoir. One is half drilled. By the end of this year, we'll have -- the target is to have 4 or certainly in Q1, we should finish completing and testing the first 4 wells. This project could probably run to capacity on 3 wells. We've always said 4, but because the well test performance being a bit better than expected with projected rates in some of the wells over 300 million standard cubic feet per day at full rate. These are big bore gas wells, and you could probably run this facility on 3 wells. The plan is to drill 6 and then hopefully, that gives us a contingency built into the system all the way to the end of this project. If I go to the project -- the integrated oil and gas portfolio, and we look at that. And basically, as I said earlier on, that's Western Australia and Alaska. Pikka, of course, is a project, it's a development project, it's not a producing asset yet. It's coming closer, but it's not producing yet. The good news on Pikka, I'll go more over the project in a minute, but I think really the thing that excites me most of at Pikka, is the quality of the product, the Alaska North Slope crude oil currently gets a premium to Brent of anywhere between $2 and $3 in any given day. So that's always good news for the Brent's high or low, right? It's always good to get a premium, run a discount to the benchmark. So it's a good project. The drilling performance recently has really started to pick up. Ironically, since we gave the cost guidance a couple of months ago, the drilling performance is now showing a saving of around 10 days per well. And so half that is about $5 million a well. So we're actually starting to see that drilling curve. We talked about early in the year coming through that learning curve coming through as we're landing these wells more consistently and showing that good learning performance. It's good that the Alaska Department of Natural Resources approved our application to expand the Pikka unit. So that protects us in terms of the future resource development opportunities, very, very significant resource position we have on the North Slope. And if you were looking in isolation, where is the sort of game-changing growth opportunity in the future for Santos. Alaska would have to be in the mix for that in terms of that consideration. However, what I will say is that what we have said to the Alaska team is let's not think about Phase 2, let's not think of any expansion or growth in Alaska, let's deliver Pikka Phase I. The focus is myopically on delivering Phase I. And if I go to that project, we'll jump back to the WA slide in a second. If I can go to the Pikka slide, please -- you can see here, I've covered a lot of that. We've got 10 wells flowed. So the biggest rest of this project was always reservoir, always the reservoir. We've significantly derisked that now with the well results coming in line with expectations. And as we've drilled more to the South, I'm going to impress Rebecca here, as we drill more in the south, the reservoir quality is improving. We're seeing better reservoir. That's exactly what we predicted would happen. So that's good news. And all of these wells are drilled from one drill site, and we're still maintaining first oil forecast in mid-2026. So the project is almost 70% complete. It's actually ahead on time on the curve and going well. You can see some of the highlights there and if I can jump back to the last slide because often forgotten about with no major projects that we talked about in Western Australia. Western Australia has had a lot of activity going on over the last year. And good news is that the -- we successfully drilled the Halyard infill well recently, and we've got an upside outcome there with the EUR expected to be around 20% higher than our P50 expectation predrilled. So that was a very good result and significantly under cost at this stage of that project. Now that will be tied back in Q1 2025 and online in Q2. And so we're really happy with that as an outcome and particularly the excellent execution by the WA team to come in sort of 15%, 20% under budget on that project to date is an excellent outcome in this inflationary environment. A lot of M&T activity in the West and the guys Sean and team have done a fantastic job there, realizing higher gas prices, being able to use our transport positions and the fact that we've got gas from different assets, we can move about that system. So that's -- we're being able to help other people who have supply issues and make some extra revenue there. So a great job by Sean and the team over there, continue to squeeze more out of Devil Creek and Reindeer. We're cycling those wells. So I don't know if you recall, we said that, that field will be finished last year, end of field life last year. And what we were able to do with the reservoir there is shut it and let pressures build up, cycle it for a couple of months, shut it again, when it dies and keep doing that to squeeze more gas out of that asset. And that's been a real good optimization by the team. Again, relatively high cost production because not producing every day of the year, but we're getting more out of it and it is commercial. And in terms of Ningaloo Vision, currently shut down doing some repair work, maintenance work on the facility right now, but a good strong production year-to-date on the Ningaloo Vision. And that comes to end of field life planned for early 2025, but we're in discussions to try and extend that a few months, an extra 4 or 5 months or so. And that's why we're doing these repairs right now to try and support that application. We decommissioned the Campbell platform, and it's 90% of the materials there were recycled. That was a great effort by everybody, again, right on budget. And of course, our decommissioning works not only for offshore platforms, we've decommissioned a number of offshore wells in Western Australia this year. And as much as you might look at those as hollow barrels, or hollow dollars we're spending, it's a liability we're clearing up. We're clearing it. We're getting off and we're doing it efficiently with 13 wells around Varanus Island and 4 so far around the Mutineer, Exeter, Fletcher and Finucane fields, and we'll finish that campaign, I think, by the middle of next year. We will have done all of the wells on the Met project. If I can go forward please, a couple of slides. Moomba Phase 1 online and storing CO2. Well, of course, -- this is exactly what we said we're going to do. I mean I've got a quote for me in October 21, saying that this is what we do. But we rolled this strategy out in 2020. We rolled our net zero targets and our strategy and our vision out in 2020. And we said it would be online in 2024, and it's online in 2024, and it qualifies for ACCUs. It qualifies for ACCUs that's exactly what we said we're going to do. And what I'm really proud of all of the team and some of them aren't even at Santos anymore. Some people have moved on. They got poached, they go and work on CCS projects elsewhere. I just want to acknowledge all of their efforts in making this happen because there was a lot of people trying to stop this project, not want it to happen. A lot of obstacles thrown in the way, but it's online, and you can see it's capturing all available CO2. It's injecting it and we have spare well capacity. That green line tells you what the capacity. So the capacity we have in our wells, injectivity capacity, it's above that of the facilities. So we are limited with our facilities to around 1.7 million tonnes, if we have 1.7 million tonnes. And the good news is as of just the other day, we've now stored already 150,000 tonnes year-to-date since it came online. Even though some of that has been during that commissioning phase where you can see we've been shutting in testing things and stuff like that, 150,000 tonnes. Now 1.7 million tonnes per annum. To put that in context, that's the equivalent of taking something like 230,000 cars off the roads in South Australia every year, every year, you're doing that. So a very significant contribution to emissions reduction in the state. The entire emissions of South Australia is 15.8 million tonnes per annum. 15.8 million tonnes. We're taking care of 1.7 billion of those here at Moomba with this project, this Phase 1 project. So really significant. You've got a -- I know there were some questions, I think, about the breakeven cost for this -- it's $28. So let me say approximately $30, it's $28 breakeven life cycle for this. That's the cost of carbon we need for an NPV 10 outcome. That's the way to think of that, right? So we're very confident that this is one-off, if not the lowest cost carbon capture and storage project in the world. You can see how it compares with a lot of the benchmarks here. And very importantly, why we put so much effort into this, this project is the catalyst to build a belief and the momentum around the other aspects of our Energy Solutions business. And it's been really important that we push through the criticism, the obstacles, the resistance to get this project online to show that it's worked. We've been injecting gas in the Cooper Basin for 50 years. It used to be part of our business model, right? We used to store it in the summer, produce it in the winter, right? Inject it in the summertime, build up our storge to 70 terajoules or so at the Moomba storage facilities underground storage and then produce it in the high demand winter seasons. So we know the reservoirs. And likewise, an even better reservoirs for storage as at Bayu-Undan one which I'm sure Alan will talk about later. So then if I go to talk about net zero and net zero targets, delighted to announce our new carbon storage target for Alan's Carbon Management Services business, which is to build and operate a commercial carbon storage business that will safely and permanently store around 14 million tonnes per annum. And that's a very significant number. So when we to build. CCS projects taking third-party CO2, third-party CO2 and store it, and we want that to be around 14 million tonnes per annum. And that's a target we're setting by 2040. And why that's a significant number is because that's equivalent to around 50% of our Scope 3 emissions in 2023 or downstream Scope 3 emissions that come from the use of our products. And so it's a very significant number. And the longer-term target, the aspiration more than our target, it's an aspiration is to store more carbon than we have met across our Scope 1, 2 and 3 emissions. That's a longer-term aspiration for Alan's business to build that business, a commercial profitable business. It makes money out of storing other people's CO2 and you can see we've got our other targets that were previously published. Nothing has changed there. Now very interestingly, when we talk about our 2030 emissions intensity targets, that's against our 2020 baseline levels. What I can tell you is that if I just -- the minute we switched on the Moomba CCS project, we reduced our current emissions intensity for the company around 25% on a day. It came down around 25% on a day. And if I take it back to my 2016 level, now I'm confusing everybody with different hopping around the benchmark, it's about a 33% reduction just by turning on Phase 1 at Moomba. So it has a very significant impact on the emissions and emissions intensity of our company. So that's net zero. If I move forward in terms of building our business and building our future, you can't do that without investing in communities. And I thought it was worth sharing with our investors, some of the good progress we made. One of the things we focus on is local employees. That's a cost advantage to us. Moving away from high-cost FIFO expat workforces and having locals trained up and competent and bringing them in our organization, train them in different assets and put them back to their home countries so they can run those assets locally. We have some assets that I've got -- when we inherited them, had very significant expat workforces, which are very expensive, like very expensive. They're not cheap. And you can see the high levels here of local workforces. And even in Australia, we're looking at local communities and saying, how high can we drive the local workforce levels there instead of fly in and fly out because it's all costs. Now you might be a Qantas shareholder. You might get nervous about me saying that or Virgin or whoever else. I want to pick on Qantas, they've had a tough year as it is right. That's not my aim here. But the point is we're not here to support airlines and support all those other opportunities. We're here to get the lowest unit cost we can across our assets and our local workforce makes sense. You can see even in PNG, we've got a local workforce, a local content level that's higher than oil search ever achieved in the history. We've done that in 4 years -- or 3 years. In 3 years, we've now got something like 92% local content and PNG. We've got the first senior operations leader, being a national in PNG and so we're really proud of that. Female representation, that's one of our diversity metrics. We don't have public targets like a lot of company does, but we believe in diversity. We believe in the value of diversity. And you can see, I mean, that only shows you the progress from 2021. That 40% was in the mid-20s in 2016 for a 1% in the office. And that was 6% back in 2016. 6%, the field representation. So again, a lot more females working in the field, breaking those old cultures and more modern, young, enthusiastic, ambitious folks working in the field. And we've seen great progress and cultural improvements as a consequence. You can see the number of cultural heritage assessments we do across our onshore operations, really significant. People walking the land and looking for cultural heritage and artifacts, et cetera, ahead of drilling rigs going into drill wells and making sure that we get the clearances. We have -- I can't remember how many, it's close to 100 to be 70, 80, 90 people at our cultural heritage officers, traditional owner officers who go out on the land and inspect the line and give us the clearance to go drilling our wells. A lot of effort in that space. Indigenous employment we've really ramped up the amount of indigenous employees we have across the organization over the last 4 or 5 years. You can see that building up. And of course, indigenous spend, what does that mean? That's not spending on indigenous people. That's not what that is, so if you -- don't go dividing that number by the number of employees you work or from other charts, I think they're on mega salaries, that's using indigenous owned or partially owned contractors and building that capability in those, again, local communities. So a good long-term benefit building that capability, local to our assets. And of course, you get the cost advantage of not having to mobilize international contractors to do work where you can build local content. If I keep moving forward. I think we want to switch gears now. So that was a bit of kind of intro into the sort of longer-term strategy stuff. I thought what was interesting is just to stop and say, what are we building at Santos. Strategy is not a 6-month scheme. You don't change your strategy every 2 or 3 months. And I thought it was worth reminding people, we set off on a journey back in 2016. And the first objective of the transform part was to get an operating business that produced cash. Free cash flow from operations. That was step one. We weren't doing that back at that time. And we had to have a business that could do that right through the cycle, right? You should be able to generate free cash flow. Now you would talk about the quality of the portfolio, whatever. It doesn't really matter. You've got to have a business that is focused on generating free cash from its operation. That was that transform phase. And then, of course, we went to build the portfolio, and that was the acquisition phase. We did the Quadrant Energy deal in Western Australia, a really important acquisition for Santos and it really played its part in 2020 when the world crashed again where we had all these fixed-price CPI gas contracts, high volumes at the time that gave this wonderful hedge in the portfolio. And so you might look at that as an NPV thing and say, well, that didn't deliver any more or less value because of that, but it protected the company through that phase and that was a really valuable part of the diversity mix in our portfolio. And that was a very deliberate strategy, and it gave us some of the resource development opportunities in the West. Then we did the Conoco acquisition of the Northern assets. And some things are better to be lucky than good, right? And of course, the very high commodity prices in 2022 and the fact that every single cargo from that facility was spot in 2022 worked to our advantage and made that a great acquisition. And then, of course, we had the merger with Oil Search at the end of 2021. And if you try and think of Santos today without that. what would it look like? It looked very, very different and a much weaker company. So that was how we were building and growing. And of course, we're in that growth phase now, which is capital intensive. We don't hide from that. It is what it is. We knew when we went into that it was going to be a tough 2 or 3 years to deliver on it. We're coming to the end of that phase now. So what next? And our backfill sustain or decarbonize and low-carbon fuel strategy is designed to build a more sustainable business. We've been on a journey for 9 years, try and build a company that can provide sustainable cash flows, and we can move from an organization that is focused on operating free cash flow to one that can think about true free cash flow, after its investment, after the backfill strategies nor the rest of it, having cash left to return to our owners, to our shareholders. That's what we've been trying to build. You can't do that overnight. We'd all love to just press a button and it just pops up and you get these wonderful assets. But we've been on a journey is steadily improving the company year-over-year. And we'll show you how that is going. It's not all been smooth sailing. We've had to deal with a 1-in-100-year earthquake in PNG you thought were going to say pandemic a 1-in-100-year earthquake in PNG in 2018 that took our key asset offline for a number of months. We've had to deal with 2 very severe oil price crashes during that period and, of course, a 1-in-100-year pandemic, a couple of takeover temps that whilst they never played out to fruition, take a lot of attention and distraction inside organizations to manage your way through that. And yet we've continued to stay myopically focused on our strategy to get to the desired endgame, which is coming. And that's what we call our sustainable return space, which is about building a business that can still going to have to reinvest capital. You can't stop investing or you fall off a cliff 5, 6 years down the line. But you'll see it's a much more sustainable business, particularly in the next 5, 6 years. And we can invest in a much more prudent and shrewd way that allows good returns while we're investing to maintain production. And we'll talk about that as we go forward. So we go to the next slide, which is that 3-horizon strategy. We switched in 2022 from Transform, Build, Grow, which is really the turnaround sort of strategy, if you like to one of things more longer-term, all the way out to sort of beyond 2030 to 2040. And that's that backfill and sustain. And important to think here that, that doesn't mean you can't grow. I mean, some people have said to me that backfill sustained, it sounds like you're standing still. Not at all. It's about focusing on infrastructure. It's an infrastructure-led strategy. It's about focusing your new opportunities around existing infrastructure, so you can leverage off that and if you think of brownfield projects versus greenfield projects, get that unit cost of development down, get those lower cost, lower risk projects in the future that give you better returns. And so that's very much the focus of backfill and sustain. And it also doesn't preclude backfilling other people's assets and infrastructure. If we've got resources close to them. It's not just our own infrastructure. It's looking for backfill opportunities around infrastructure that save you having to rebuild or build new greenfield infrastructure. That's a big part of our strategy. Importantly, that's about driving improved performance through technology, efficiencies and working with those lower cost operations to drive value. We will be prioritizing investment in our LNG backfill opportunities, particularly over the next 5, 6 years in PNG, Northern Territory in Queensland. And so Barossa sort of takes care of itself, right, for Darwin, but we've got the other assets that we've got to think about backfilling and filling them up. And of course, the immediate deliverable there is Pikka and Barossa, delivering on those 2 big major capital projects and coming out of this growth phase to get into that more sustainable phase of operations. Our decarbonization strategy is pretty straightforward. And of course, Alan will talk about low carbon fuels later on. And what does that look like over the years, have a go to the disciplined operator more of that. This is the premise or the approach we take in Santos for delivering on our strategy is remaining disciplined. And sure, we have a few bumps along the way. We'll make a few bad decisions, but tell me a company that doesn't do that. But 9 out of 10 is what we're looking for a call right, but it's about calling them quick and moving forward, learning from failures quickly and moving forward and continue to drive improvement in the organization. You can see that when we started off, we had a very high cost base, we had to do something on cost and we have a [ macho ] where we fight inflation. We try to fight inflation. Over there and again, you can see in 2022, '23, everybody would have thought all our costs would have come down when we did Oil Search merger, right? But when you merge companies together, there are inefficiencies that come from all of that, and you're going to work your way through that, analyze it, understand it and then take that cost back on. Sherry will talk a little bit about what we're doing in 2025 to drive costs back out because it's time for another cost refresh at Santos. But you can see, generally, we've been driving our unit cost of production down. We've shaded out these late life because we're squeezing that a little bit out? But if you ignore that late life, you can see we're down at $7.36 or so just now, and we will drop below $7. We are targeting below $7 once Pikka and Barossa come online and get those volumes up. And that you can see how the volumes goes up, the costs go down. You can see what happened in 2022 when we were down to $6.83 for our long-life assets. And so if I go to the next chart, and we look at what does that mean in terms of returns. We have actually been focused on this from a company that was providing no dividends in '16 and '17. And prior to that, it was a bit of a talk in dividend. We've really been focused on that cents per share growth over time. Now we can't guarantee we'll grow that every year in the future. We can't guarantee what commodity prices are going to do and all the rest of it. But you can see that year-on-year, the business is getting stronger. And if we just continue to stay disciplined and we stay focused on delivering on our strategy, we're building a stronger business over time, and our metric is to keep driving it to get stronger and stronger, there'll be commodity price shifts, but we cannot plan a company. You cannot take 20-year bets and adjust them every time the commodity cycle shifts. You have to take long-term strategies, long-term views on things and believe, in what the end game looks like and drive all the way through, and we've been doing that. And particularly when you see that with the CCS project. I think that CCS project in 10 years' time is going to be one of those really big iconic things that we did at Santos, and we'll look back and be very proud of as a company. Over that time, you can see the shareholder returns more than 200% since we started that transformation journey, $3.7 billion over that period delivered in dividends. And I guess that would include the buyback as well. And of course, last year, record dividends. So when we can, we will give it back to our shareholders when we can. We won't always be able to give you everything back. And I know that was disappointed. Some of you would like it all back all the time, but it doesn't work like that. We do have to reinvest some capital to keep it going for the longer-term and we hope we're going to get that balance. But I wanted to finish my section by talking about what I said last year when I was here. So we said we'd deliver safe and reliable production from the base business. I showed you the results will continue to perform safely and reliably and the reliability stuff in PNG, a great demonstration of how reliability and safety can drive higher production and higher value outcomes. We said that we progress our major projects which a year ago was a big call, if you recall where we were on Barossa, particularly. But Barossa is now 84%. We're at 67% back then and Pikka, of course, is 69.3%, 70%. And we're very -- we're engineers, right? 69.3% is where Pikka is versus the 37.4%. We're very accurate on these numbers. Halyard didn't throw a well. So we said we backfill sustained production across our East Coast and West Australia. And so the activities we've delivered in the last year, Halyard, good outcome, great outcome, GLNG delivered 6 million tonnes per annum, again, a strong sustaining capital activity program this year, drilling greater than 330 wells across GLNG and Cooper. We said we'd deliver Moomba CCS -- it's online. As I said earlier, it stored already 150,000 tonnes of CO2 year-to-date. So well on track to exceed the target that Brian put out in the recent market communications. We said we progressed Bayu-Undan and Reindeer CCS projects. Now I've got to be honest and say, Bayu-Undan feed has progressed well. The approvals haven't progressed as fast and the regulatory system hasn't progressed as fast as I would have liked that too, and we're very focused on driving that harder through 2025 and working with both governments. Reindeer feed is progressing. And on the seventh of November, Australia ratified the legislation adopting the amendments to the London protocol. And that's really important because that allows the transfer of CO2 across borders. So that's what we really needed to be in place. So the regulatory systems can then be built to support transfer of CO2 across borders, which we need to go to Timor-Leste. And then, of course, progressing our low-carbon fuel studies. And Alan will talk more about that number of studies, number of partnerships. And the Moomba CCS project is absolutely pivotal to unlocking that potential in the Cooper Basin because we need CO2 feedstock to make synthetic fuels in the future. And so that's my section. And so what I'm going to do now is hand over to Sean Pitt to talk about the markets. Over to you, Sean.

Good morning, and I realize I'm standing between everyone and coffee. And I think quite a few of my colleagues were up quite late last night. So think caffeine injection will be quite warranted. So my name is Sean Pitt. I work for Santos, has been with Santos for 4 years and prior to that worked for various companies, including one of the largest buyers in the market to work for Jera for some 6 years. Today, I'm just going to talk to you a little bit about market. I'm sure there'll be questions afterwards. It's always an interesting topic. And I'll do my best not to talk too fast. I'm a marketer and it's about background, so I tend to talk quickly, but I'll do my best to try and slow it down for everyone today. I think -- we'd like to start just on the global energy demand. We're going to narrow down into sort of the markets that we work within and that we supply from the vast assets that we have in the portfolio. So to start with, sort of global energy demand. I think one of the key things I take away from this slide and some of the market components including S&P and others, is that the demand is increasing. And I think one of the key drivers of energy demand increasing is around AI, and we're starting to really hear this more and more and more. And it's sort of a very much a news headline grabbing sort of article. But when you're actually talking to customers and you start talking to suppliers of energy, both through electrons and others, it is really forefront of their mind. That, plus the growing economies, developing nations, that energy demand is increasing. It's not slowing down. Overlay that with a transition. And there is a very big drive towards renewables and energy transition, and we're supportive of that. The gap starts to widen in terms of how we're going to fill that energy demand. So coal will come out. But gas and oil will continue to play a very critical role within how we're going to supply those -- that growing energy demand, both through either it's AI, developing countries and replacement energies. The other challenges with renewables is that we continue to see the challenge with the pace at which renewables will come in. That will take time, it will take more money. And that transition is certainly moving in that direction. LNG. I think every buyer, every seller, every analyst, governments, all have their version of this slide, but the one common theme is generally we see far greater than demand than we have for supply. The interesting thing though that we take from this slide is really from Wood Mack is that the majority of the demand is in Asia Pacific. So there is definitely growing global demand in Europe and other places due to geopolitical factors. However, Asia is still the strongest demand center globally. Interestingly though, however, most of the new supply coming to market is not in the same region as the demand center, the largest demand center. So it's going to have to come further. It's going to have to come to meet that large demand center and that growing demand center in Asia as it transitions and meets those challenging new energy demand centers such as AI. However, there's very little new supply or growing supply in this part of the world. We had this conversation with someone this morning. So for us, it presents an opportunity. So in terms of positioning in the Asian market, and as I said, that is pretty much where the largest demand center is. We're in a position where we're in the right neighborhood. We've got the right post code. And many of the portfolio assets that we have are in close proximity to that market. And I think as you heard before, Kevin had mentioned this. For us, that provides us a unique situation where we can leverage those portfolio assets. If I look to the bottom left-hand corner, we have a particularly large contracted book. However, that book is built on 3 premises. We retained some spot exposure. We have built some midterm contracts and some longer-term contracts with end users that are looking to further decarbonize and leverage our other existing business, which is [SES] decarbonized LNG, but also the fact that we are contracting such that we are maintaining a high oil indexation slope. So when I talk slope, I'm talking the 13%, 14%, 15% contract numbers. We're looking to try and leverage that as high as we possibly can. Really what we're leveraging here is our low-cost, low-emission shipping position. That gives the buyers a couple of advantages. The big advantage for them is they are very focused on methane slip and their exposure to their total reportable, but most importantly, security supply and short value chain runs to market. We have probably one other significant advantage in that portfolio has got a high heating value, particularly for gas companies in Southeast and Northeast Asia to reduce the ability to spike. It reduces cost, but also reduces handling. And again, emissions is very much forefront of their mind. And something that we have seen coming through our contract stack is effectively the buyers are now coming back to market. Before COVID, we started to see buyers shifting away, starting to look at whether they could look for shorter run commitments to keep optionality open. We have seen a significant shift in people looking for 10-, 12-, 15-, 20-year commitments to LNG. That's been very welcomed by us. But equally, they're looking for those sorts of security commitments, but also to help them decarbonize. They can see well into the 2040s and 2050s, the role that gas is going to play, and they want to make sure that, that gas is available. What does that translate to? In the bottom right-hand corner, we are looking and have been able to secure quite high realized prices and continue to. That mix of spot mid-term and long term has been enabled to us to realize quite strong pricing on an oil indexation basis. The reason we keep a mix between mid, long-term and spot is such that as we see market shift, we can then come back and either adjust our portfolio of contracts, we might want some more JKM exposure or spot exposure. Then we can also respond to buyers' needs to, that there is a really strong central pull for price on a pricing basis and demand center basis that they need some additional supply of front in some new contracts, we can respond to those requests. Changing pace. Domestic Gas, I think both East and West is quite challenging in the basis that there is far greater demand than supply, both [G-2], EnergyQuest quite accurately report this. It is really a function of lack of investment to make continued demand. However, we are well placed through opportunities like Corvus in the West, Narrabri in the East to meet that demand. But again, similar to other economies around Asia Pacific region, around the world, decarbonization is for front and center, but gas will continue to play a critical role in part in that decarbonizing strategy. If we don't continue to invest and make available new supply, we will impact the lights and power of houses, manufacturing in Australia, it will have a direct impact. But for Santos, the portfolio of domestic gas assets we have are there, we just need to be able to have the ability to bring them to market. Oil. If I can predict the oil price, I certainly wouldn't be working for Santos and Kevin. Unfortunately, I would be certainly somewhere else. But I do find it a fascinating subject. Oil price, and again, there's many versions of this slide, everyone has one. I think the one observation I'd make about oil forwards is, I don't believe it really reflects the risk in the market. And again, someone today, I was talking to about this and we share similar views that 5 to 10 years ago, somebody parked a ship in Australia [indiscernible] price go up, and it would sit there [stationed] until that issue was resolved. Now we have multiple conflicts around the world. We have embargoes, we've got geopolitical risk. And it seems to just be so much noise, so much risk, the market really doesn't have to factor it all in. However, what we do see though is this contango structure. We see the forward price of oil higher. And that really does reflect the chart on the right, which effectively is, we don't have enough demand -- sorry, we don't have enough supply to meet the demand going forward. And that is what is supporting oil. I'm quite bullish on it. I think oil over the mid- to long term will be much stronger. We will have cycles, and we need to run the business, and again, I'm not taking thunder away from Sherry, but we do need to build our business to run on low-price oil. We need to be able to be resilient to $30, $40, $50 oil, and we contract on that basis, and we try to give as much optionality to the business to manage the business that way as it can. However, the mid- to long-term run rate is quite a strong signal for strong oil price. We should benefit strongly from that. The important thing, too, is that the portfolio of all that we have. Now we are very much an LNG company, but we have got a fantastic set of oil assets, everything ranging from Cooper, through to Kutubu, through to Pikka coming online. We've got a very strong set of all assets. They all generate and capture through the spot market, and that's a focus and strategy that we have to try and get premiums to that product. And if you note, the run rate is over $3 per barrel over the Brent printed price, which is a strong -- very strong return, really. Carbon. I'll finish off for carbon because right after this, I'll go into a quick summary and then off to the coffee break. I think from a carbon perspective and RepuTex and others really do capture this, and again, won't take too much thunder away from Alan later on. But effectively, in 2027, we do see a shortfall or insufficient supply of ACCU in the market from '27. I think it's important on this first slide, we do note that probably doesn't take account the inventory. There's probably a lot more inventory of credits than probably reflected here. But the other factor to take into consideration too is the pace at which they're going to be required and some of the regulation and methodology the government is working through in terms of ACCU deployment is going to change as well. That uncertainty, I think we believe it is probably close to the dark blue line, but there is going to be a challenge in the next 12 to 18 months and quite a bit of uncertainty. I think really what is interesting from a pricing perspective is the middle and far slides, where you can see the forecast from these market reporters that the ACCU price is materially lower going forward out into the latter part of the decade than where global markets are. So we can only really see that probably there's going to be upward pressure on ACCU from the commercial business perspective, this really does position us well for assets and projects in Alan's portfolio such as Moomba CCS and the other CCS hubs. So we're well placed to capture that upside from a commercial model perspective. So that's really where we're focusing on. I'm just going to finish off, just a quick wrap up. Just tease out some of those key points and then we'll get off to a coffee break. But from an LNG perspective, the strategic location is probably front and center. We have a very unique portfolio. I've worked for quite a few companies from Woodside through to Shell and Jera and others. We have got a very nice portfolio set in the right location, with the right post code, with a bunch of customers who are desperately looking to lock that volume up for more than a decade. We've got -- we recently were in the market and made some announcements about some midterm volumes, we were oversubscribed, long-term demand. We're oversubscribed. I don't have enough product for the demand that's currently there. We offer a longer-term emission capture and storage solution, and that has been a very important factor in some of those long-term contracts that we've entered into in tech. There was one earlier this year with [indiscernible]. It was a factor in their decision-making that we've got a plan. We've got a strategy and they bought into that. They believe it. We've got high-value LNG. We have got a very strong position in terms of both high heating value. We've got a very nice portfolio that's now being built out between spot, midterm and long term. We'll continue to execute that strategy, and you'll see some more stuff coming in the future. But we will retain that ability to move between spot, JKM and that oil indexation as the business needs to adjust to market, and we'll continue to leverage the existing infrastructure. We're well placed for domestic gas supply. We like the market. We enjoy being in the market. We want to keep the lights on. We want it support jobs in Australia and manufacture in Australia. We just need to get it to market. And I'll just close off with the oil. We have Pikka coming. There is very strong interest in [I&S. I&S, we will not] take it to the U.S. We'll avoid very expensive [indiscernible]. We will bring it to the Far East, China, Japan, Korea are looking to displace or replace existing oil feedstocks, both through via decline and sanctions. And there is very, very strong interest, and we see some very strong pricing signals well above Brent when that arrives in Australia -- into Asia. Thank you.

Thank you, Sean. On that note, I think we're right on time for the morning tea break. So how long we got, Brian? So let's take about 15 minutes morning tea break, and we can all be back in 15 minutes' time, we'll go forward. Thank you. [Break]

Okay. Good morning, everyone, and welcome back. I've met many of you before, but for those of who I haven't, I'm Sherry Duhe, I'm all of 5 weeks into the company now. So Kevin, nicely arranged for my onboarding that I could roll out this new capital allocation framework. He's very into management development. So I really appreciate that. I think many of you have been perusing the slides and also commenting and questioning a bit on the break, and I'm excited today to talk to you about 3 things. The biggest one obviously being that we're rolling out to you and announcing to you today, an updated capital allocation framework. Why is that important? And why are we excited about that? We're obviously coming out of the back end of what's been a major growth cycle. We've got new production coming on stream in the middle of this coming year with Barossa and then into the earlier mid part of the year depending on how the schedule goes for Pikka. And we know and we have heard you that you're really wanting us to make sure that we prioritize and improve our overall shareholder return once we come out the back end of that capital period. We could have waited a little closer to those cash flows to roll this out, but we thought it was really important to show that commitment to you now. So in a few minutes, we'll take you through the principles and why we believe that, that will offer sustainable improved shareholder returns over the cycle. I'll also briefly today talk about how we're going to continue to drive the disciplined low-cost operating model. And Kevin's reference, we're going to be putting a big priority on a refreshed cost out across the business in 2025. So I'll give a bit of a preview of that. And then last but not least, I'll talk about the healthy and diverse portfolio we have to feed that capital allocation discipline for not only the next 5 years' horizon, but also for many years into the future. If we can go to the next slide, please. But before I go into talking through the 4 elements of the framework, I just want to spend a minute refreshing and reminding on the strength of our balance sheet. You've seen these decks before. And the important thing that we'd like to note about this is that we have a very strong and stable track record really going back to 2016 of maintaining the same investment-grade credit rating. That is something that's been really sacrosanct to us to make sure that given the cyclical nature of our business, that we always have a strong balance sheet, that we have a competitive cost of debt funding and then we've got flexibility to access that at different points through the investment cycle. And again, regardless of what's happening with commodity prices. Won't go through all of them in order of time, but we've had several things that have happened just even in the last few months here in terms of our financing activity that demonstrate the health and the -- basically, robustness of that framework. We've got over 4-point -- almost $4.3 billion in liquidity. And as we look at our target gearing range, that remains unchanged. We have that at 15% to 25%. We think that really keeps us very well positioned in that strong, stable investment credit rating and also gives us a lot of flexibility as we go through to manage our balance sheet and again, prioritize improved shareholder returns as we come out the back end of this major investment cycle. So we go on to the next slide, which is really the center of the updates today. Now there are 3 principles that have gone into this. The first one, obviously, is the table stake of having a strong balance sheet. The most important one sitting in the center is, as I've mentioned, improved shareholder returns. There's no doubt we've heard you loud and clear that you don't want us to go through once we come out the back end of Barossa and Pikka and invest in 2 major mega projects at the same time. Certainly, not at the same working interest, and we're planning to act on that, and we're planning to deliver on that. So what does that mean? There are 4 elements. Gearing, I just talked about. The main element and the key change here is that we're moving from what has been an free cash flow from operations, which in our definition has included sustaining capital to really, as Kevin also referenced, moved to an all-in free cash flow metric. Now some of you will say that sounds like a downgrade immediately because aren't you just going to go and spend all of that on capital; again, well, it's exactly the opposite. What we're looking at is that the way that we can demonstrate to you post Barossa and Pikka that we will prioritize shareholder returns is to hold ourselves to account very simply and very transparently that every single dollar we spend, whether it be major development CapEx, whether it be sustaining CapEx and of course, our operating expense and corporate cost that we are spending that in a way that prioritize an improved return throughout the commodity cycle, but also helps us keep a sustained production for many years to come. We've recognized, and this is not unique to us, I think, across our sector that from an investment thesis perspective, you're not interested in us doing boom or bust. You're not interested in us coming back out in a few years' time and saying that we're going through another growth cycle that will have suppressed shareholder dividends for some period of time. Rather what you want is a sustainable and an affordable CapEx level that generates predictable and reliable all-in positive free cash flow so that with that, you have a positive dividend throughout the cycle, but you also have long-term growth from an overall shareholder investment thesis. Now how do we make sure that equation works so that you don't run it through your models and come up with a negative number? There are 2 pieces, and they work together. The first one is a production range that we're really focusing in for the next 5 years on 100 million to 120 million barrels per annum. Now you've seen previous long-term indicative production profiles that we've put out that have talked about a range that's wider than that, that goes from 100 to 140. And certainly, when you look at our funnel, there's many different ways that you could think that we could actually go after that 140 pretty quickly and probably deliver it. However, if we did that, particularly in the next 5 years, what you would find is that we would bust out of that capital ceiling from an affordability perspective and not be able to offer you an improved return in the short run. So I felt it was prudent, and I'll come back in a few minutes to talk a bit more about why 1 to 120, that we put that range in place for the next 5 years to demonstrate that discipline on capital to support that range. The other piece is that we're putting a capital ceiling in place. And we've had mini debate as management own a board around how do we give you confidence now given that it's 2 years out, that, that will run through your models and have an answer that is as good, if not better than the model we have today. And that's going to come as we get closer to 2026, but the thing that you have to understand about that is that it works as a formula. So each year, what we need to do is come up with a budget and a plan that at very conservative commodity planning prices because that's what we always do. We don't count on high prices to deliver those outcomes that we can go through and have significant all-in free cash flow and that we can prioritize that return. So what that also means is that every project in the portfolio has to compete absolutely against our hurdle rates, and it has to compete against returning it to shareholders within that production range. So when you think about those all in, we believe that, that actually holds us to account as transparently and as simply as you can imagine, that every dollar we spend will be well spent and that, that improved return will happen throughout the cycle from 2026 when we're targeting this coming into place. Going to the next slide, please. I won't spend much on this slide. This is really the format that you're normally used to seeing when we talk about our current framework. Just a reminder that this is targeted to come into place only from 2026 when both Barossa and Pikka are on stream. And so until then, we'll continue with our current framework. Maybe just 2 things I'll talk about here on this slide. One is that indeed should think about the all-in free cash flow as not that we're going on a diet because somebody asked me on the break, whether or not this is us putting ourselves on a diet. And I don't know about you, but each time I go on a diet, that puts you back into the boom-bust cycle of it, if you haven't started eating healthily and you haven't started exercising, it's just going to come back again and it might get worse. So I think that's not the analogy that I would use. What I would actually use is, we're adopting a sustainable lifestyle in our capital spend. And what that means is that we want to make sure building on the 10 years of success we've had to have a healthy funnel, to have a very steady base that we put enough capital back into the funnel, but not too much so that we continue to offer improved shareholder returns, both now in the next 5 years and many years into the future. The other thing I would point out around this slide is that we talk about returns of at least 60% of all-in free cash flow per annum. That could go up to 100 in any year. And we're also setting ourselves an additional belt and brace around that. But if we get below the bottom end of our gearing range, we will pay out 100% full stop of all of that free cash flow to investors. So even if we get below the bottom of the gearing range, we won't then allow ourselves extra room to spend more capital. We'll keep that discipline regardless of the gearing. Next slide, please. This slide is really, really important, and it is the key piece of information that you should be aware of today that gave us that confidence that the $100 million to the $120 million is the right level to target over the next 5 years and that affords us a lot of room to be very disciplined in our capital and not have to spend amounts that would result in a nonattractive all-in free cash flow. So what this chart shows, and I should give the usual disclaimers that this is not guidance. This is indicative and this is something that we'll continue to update each year in our annual guidance. But what it is, is a modeled assumption of our base business, and that includes Barossa and Pikka Phase 1 coming on stream and one tie-in in APF in Papua New Guinea that is an assumption because it hasn't been decided on yet, but that's much more like a sustaining CapEx backfill in PNG rather than major development CapEx. So what that says is if you look at this line, even if we do nothing else, on any major project development across the whole global portfolio, we will stay in that range of 100 million to 120 million barrels just on the base business between now and 2030. So that quite simply is what gave us the confidence to say that we know we can deliver in that range over the next 5-year period and again, offer improved shareholder returns under this more comprehensive dividend and payout model. Now of course, we will do other activity during that period, but we've got the luxury of choice. We've got the luxury of timing that will allow us to do that in a phased way and in a disciplined way. A lot of companies of our size and even much larger would die to find themselves in this position where you've got more opportunities than you can possibly spend on, but your production is not going off a cliff anytime in the near to midterm future while you make those decisions and phase that into the future. So that was really important for us to say. Next slide, please. I said I'd say a few words on cost. And I think we've already said what we're going to do. I would just refer back to the graph that Kevin has already showed you that we're very proud of our track record of being very competitive on cost. At the same time as we look at where we are coming out the back end of COVID, coming out the back end of several transformational acquisitions into the portfolio and also coming out of the back end of major project delivery that it's time to look again. So when we look at the cost where we are today, we feel good that we're competitive, but we want to do better, and we will do better. And that also gets encompassed into that all-in free cash flow calculation because every dollar we spend that is unnecessary and is uncompetitive is a dollar that can't go back to you. So what we'll be doing in the course of 2025, and we've already started on that is really looking company-wide, both at the asset level from a unit operating expense basis, but also all of our above-asset costs, and really looking to see what can we do to reset theirs, those where possible, taking action to put that in place and really setting a new baseline run rate from 2026 and forward. So more to come on that as we get into the coming year. Next slide. Okay, last slide before I turn it over to Brett. Hopefully, this just illustrates what we've been talking to you about for some time now is that we are in a very enviable position as a company. We've got a number of projects. Don't look at this as a time scale. We've got a number of projects that are different levels of maturity. Brett will go into for his portfolio, how those are very advantaged in terms of existing infrastructure, in terms of our backfill and sustained strategy that we've been talking about for quite some time. And we've got projects that are coming through that are already, of course, benefiting the cash flow in the next year to 2. And what we will do in a very disciplined manner is look at how we take those through. They won't all come through at the same time. But again, it is a luxury of choice that allows us to basically make the best decisions that we can make now, keep that production stable and profitable for the next 5 years and build a portfolio that can deliver, we think, sustainable and attractive returns for decades to come, which is again something that we've been building up for many years now, and we plan to pursue as we go forward. So I will probably stop there and turn it over to Brett to really do a deep dive into his part of the portfolio.

All right. Thanks, Sherry. I'm Brett Darley. So I lead the Eastern Australia and PNG business. So that includes the Cooper Basin, GLNG and Papua New Guinea. So look, firstly, I want to recap a couple of things. I want to recap on our infrastructure and our asset position. I think it's important to have a look at our privileged assets. Sean's already talked about the proximity to markets and they're advantaged not just position, but relationships with long-term customers as well, which is incredibly important. I'm doing slides on. I wanted to -- then look at our portfolio. So I want to take you through the incredible amount of options that we have and then how they could fit into possible backfill strategies. So again, the best value for us is to keep our facilities full. Not building new greenfield LNG facilities, gives us again a massive advantage. And a lot of our portfolio sits within striking distance of our current LNG facilities, which again gives us a great advantage. So look, I'm going to start through. I'm going to go through all of our LNG facilities. I'll start with PNG. I'll look at GLNG and DLNG as we go through. And I'll give you what we're planning to do or some of the scenarios that will actually fit those backfill strategies from a short and a longer-term perspective. So PNG LNG, this is a world-class asset that's been producing since 2014, and I'll go through a map in a second. But base production coming through the Hides foundation field and through Kutubu from our operated assets and Gobe and Angore, which we spoke about now being online. So just to give you a little recap on where the infrastructure sits. So if you look at where our facilities are, we operate the APF and the CPF. So traditional oil-producing assets that are now becoming part of the PNG LNG gas business. And they were part of the original project development that was sanctioned. So CPF has been producing gas into the Hides gas facility for the last few years. APF is currently recycling its gas. So we produce oil from the APF at Agogo, and we inject the gas back into the ground to be used later. So that's the tie-in of that, which is about a 30-kilometer pipeline. So again, simple tie-in to be able to produce that gas going forward. It's a matter of when we do it, not if we do it. So we're looking at the best timing for the APF tie-in. All the way down, you'll see our export oil line that comes down. So there's 2 pipelines, one that goes to Caution Bay at PNG and Port Moresby, which is where the LNG facilities are. And all of the current export or liquids being produced is exported by our oil pipeline that currently exports at the Kumul Marine Terminal in the bay there. So that includes PNG LNG's oil operated by Exxon and our operated oil coming from the APF, CPF and Gobe. So we have a deep understanding of PNG. We've been operating there many years. As Kevin said, we've been producing about 25% of the feedstock gas for PNG LNG. That's backed off now with Angore coming online, and we actually have gas behind valve now. So we have the facility full, and we actually are choking back gas because we had too much gas to produce up there at the moment. But if you look at the next development Papua, which I'll talk about in a little bit, scheduled for FID next year, and I'll go in a little bit of detail on that, but you can see that down in the Gulf. And then P’nyang. So in our sequence, again, another large project and some discovered resources on the way, which I'll talk a little bit about in an upcoming slide of Juha and Muruk. If you look at the Papua LNG project, it is a backfill and an expansion project using existing and new LNG production at the PNG facility near Port Moresby, 9 wells, a 320-kilometer pipeline. Post back in we're 17%, but we also received considerable value from sharing or from allowing Papua to use the current PNG infrastructure. So that's in tolls and access fee and sharing OpEx as well. So we're working very, very closely with the operators there, again, sharing our knowledge as well with the operators and what we've been doing in PNG and targeting FID in 2015. But how do we keep PNG LNG full until Papua comes in? So CPF optimization, we talked about getting reliability up. That's value that we've added to the business since we've taken it over. That's value that wasn't attributed to that business until we brought in our experience in running older assets. So we had teams from the Cooper Basin come up and assist the guys in how to get more reliability out of those machines. We don't have a lot of backup there. We only have 3 machines there. So getting them to run full time, flat out, has not just been a challenge, but we've achieved it. So that's tick, we've done that Angore development. tick 350 million a day now coming into PNG LNG from those 2 wells. Fantastic result there, again, world-class reservoir and results from a production point of view. Hides F2. That's been spudded. So that's a well that's been drilled from an existing well pad at Hides. So this isn't a new well. We're using an existing well pad, and we're targeting the footwall. So this is a new play or that has not been drained in the Hides field itself. So it's an exploration target. We're really excited about it, but that could be online very quickly from an existing well pad producing straight back into that tube. At the moment, we can't use it because Angore's got it full. But as the fields decline over the next year or so, then Hides F2 could come in. If that exploration success doesn't occur, this will be converted into a development well from the Hides gas field as well and will give us additional backup and acceleration. The APF tie-in, up to 250 million a day coming from the gas that we have, which we know about. This is a proven resource or reserve that we know very much and we're very confident about. And that's just a matter of timing, how and when we do that project. And then even grinding away, which is what we do -- and we've got a lot of experience in making sure we eke out the last little bit of value. Gobe was meant to be finished up in the next year. We're looking at pushing -- using, again, some of the learnings out of the Cooper Basin to try and get our cost down and continue producing that and getting the last value out of the Gobe field, and I'm confident we'll push that even out past 2028. Then if we actually look at our development opportunities. I talked about Papua, a project that's -- currently, we're working very closely with the operators on P’nyang, discovered resource, Muruk discovered resource and Juha discovered resource. The thing that's good about Muruk and Juha when we look at them, they're on the way to P’nyang. So there is some optionality of potentially building and developing these things on the same route that we'd be taking to go to P’nyang. You could potentially do these earlier as part of a stage development and develop Muruk and Juha and use that infrastructure later and extend that to P’nyang or any other combination of that. And then what we're very excited, and this is one of Mike's things that I'm very excited about. Eastern Fold Belt and particularly a prospect called Wildebeest. Now massive resource play up there as well. So not only do we have near-term opportunities to keep the facility full, we've got a pipeline of discovered resource here world-class discovered resource and even exploration upside. So PNG is well positioned to keep that facility full and potentially expand that over the next -- out to 2040. And that shows you there. That's a scenario of what it could look like with our upside and backfill and sustained options in there at the moment. Keeping it full. The only little dip there, there is a 30-day shutdowns planned for 2027. So you'll see that's just 1 month of production coming off. Other than that, Papua stays full -- sorry, PNG LNG stays full and increases as we see Papua expansion trains come online. And I mean if you look at the large reserve base, reserve and resource base there, 1.4 billion barrels of oil, incredible reserve base, reserve and resource base there. So Barossa and DLNG, look, pretty simple story on Darwin. If we go to the next slide. Darwin is kept full by Barossa well out past 2040. There is the option for Caldita to come in at some point, but that is way, way out there. That's probably within the realms of production uncertainty to be quite honest. So it's pretty simple. Barossa keeps it full. What's the opportunity though at Darwin? We do have the ability there. We have the approval to actually expand Darwin LNG to 10 million tonnes per annum. So it has expansion capability up there. It also looking at off the back of our success at Moomba CCS, the ability for rebated LNG production. And we'll talk about that or Alan will talk about that in the future. But a pretty simple story on Darwin LNG, room for expansion. And that plays into, and I'll talk about at the end, one of our potential resource players in the Beetaloo that provides an export opportunity and potentially could fill that to another train at Darwin. So East Coast LNG or Gladstone LNG, I know a number of investors actually got the opportunity this year to come up and have a visit. And I know most of you are impressed by the professionalism of the team and the state of the facility up there. So thanks for coming up. Again, we've looked in here. So we've got 4 foundation fields in Queensland that are the GLNG joint venture operate between Fairview, Scotia, Roma and Arcadia. And then our fifth field being the Cooper Basin, of which over 90% of our gas currently goes into GLNG for export. So that's the way we look at GLNG. And then if you look at the profile that we have for this facility at the moment, currently producing at 6 million tonnes, the green wedge there is the third-party gas. You can see our current equity gas. So the gas that's coming from the 4 foundation fields is increasing. So every year, up until 2030, every year, every day, we are trying to break the record for our LNG -- sorry, our equity gas that we put into the LNG facility. You can see then in the Santos Equity Foundation gas supply of Horizon contract coming off in 2030. And that's going to be a great time. I'll talk about the Cooper in a second, but a great time for us to look at where we put that gas, the domestic market, the LNG market are very strong in the -- around that time for us, and that will be a decision we make. But you can see we're actually displacing our third-party supply. Kevin talked a little bit about how we've been doing that over the last couple of years. We have expansion options, not just in the Cooper, but we also have in uncontracted gas, which you can see there, and I'll talk about that in a little bit. But we do have some growth options in Eastern Queensland as well, which we can pull the trigger on. And we're working with the joint ventures on deciding how we'll put that through the facility. And then ultimately, the Beetaloo is such a large resource. Again, this is a scenario, not a forecast, but that's how big the Beetaloo is. We could fill GLNG, and we could also fill another train at Darwin as well. And it's our decision how quickly we would develop that. So I won't dive into it yet, but the Beetaloo is scalable. It's something we could decide how big and when and where that gas goes. So a lot of options for us in the future. So Cooper Basin. I've touched a couple of these points here, but you can see it's well positioned for export, whether it's going into the domestic gas market or in the GLNG. So we've got some good options there, 90% of it going into the GLNG right now. Good pricing outlook, as I said. We continue to unlock more hydrocarbons in the Cooper Basin, and I'll take you through why we think we can continue to live to that over the next 20 years, not just continue to deliver, but the option to actually increase it from the Cooper Basin. And that's all around. We start with the rocks, but then we also need to look at how we can bring that reliability up, get our costs down and some of that actually open up capacity by modernizing equipment, but very targeted areas of where we will do that. So being really targeted understanding the basin specifics. And over the last 2 years, we've spent a lot of time trying to -- and not trying to, but actually understanding where our costs are, where the cost should be spent to get the best bang for the buck. And ultimately, where our peripheral areas are, we need to make decisions about what we do with those. But growing production in our best areas, cost effectively. And then Moomba CCS, we've talked about a proven technology now that makes the Cooper Basin a really exciting hub. So not just for hydrocarbon production, but for other things as well. So a long future in the Cooper. So this is the story and people may have seen this presented in a number of ways. So why do we believe in the Cooper going forward? Well, you actually have to look back to look forward with the Cooper. The engine that drives this is 2C to 2P conversion. There's 2 separate graphs here, but the one on the left shows you that you actually took the reserves we had in 2003, we have produced far more than that in the last 20 years. And we still have reserves at the end. So if you look at that story, if you've made decisions on a 2P profile in 2003, they would have been the wrong ones. But if you look at what we currently have now from a resource point of view at 2C at the end of 2023 and look at converting that into 2P. We have a story. We actually have a plan and we're confident we've got production well past 20 years in the basin. So look, again, if we look at the Cooper Basin, we start with the rocks. So where are our best -- the largest areas of our existing and remaining resource sit right around Moomba. So that's where we should be focusing our efforts. So the central fields, the Northern fields those reserves and resources are our biggest opportunity. They're central. So from a cost point of view, they're around our existing -- right in the center of our existing facilities, and that gives us an advantage as well. So we're not at the far edges of our basin and this basin is 130,000 square kilometers. England is 131,000 square kilometers. So we are centering our efforts in the center, our homeland of the basin. And there's a couple of different plays in each of these areas that I'll talk about. So one, Moomba. We've got the Granite Wash and Moomba Patchawarra, which I'll talk about, and in Northern fields, it's Deep Coal. So these are the new plays that are supplementing our current production from our traditional reservoirs. But when we start talking about modernizing and trying to reduce our costs, obviously, being close to our major facilities means we can -- if we want to electrify, it's less distance to travel. If we want to have people coming to the facilities or we want to have equipment moving around, this gives us a cost advantage as well. So look, I'll cover each one of these plays. Moomba Patchawarra. This really isn't rocket science. We've got multiple, many, many penetrations into the Patchawarra, which is one of the deeper reservoirs that we have out in the basin. We know it's there. It really comes down to how do we get it out of the ground economically. And it's not one thing in the -- the Patchawarra play here. It's about getting costs down through pad drilling, simultaneous activities, technologies that we can use. It is a bunch of little things, a relentless pursuit of performance to actually get the cost down to turn this from a resource to reserve. So we're not just talking about -- we've just done 2 campaigns, one in Moomba South and one in Moomba North that we proved that this is successful. The problem we have now is these campaigns have got gas behind facilities. We do not have the infrastructure to be able to flow the gas that we actually have drilled here, and we've exploited. And if we want to do more of that, we actually want to target this, we actually have to upgrade or the capacity to be able to produce more from this area. Otherwise, we're forced to drilling in areas that have a higher development cost than this area here. So that's Patchawarra. In the same field in Central, you probably heard Granite Wash. So we've been working on this for the last year or 2 or more than that. 2 years again, to prove up this resource. So this is really a technology play. Again, a lot of the things that we're doing in the Moomba Patchawarra about getting costs down applied to the Granite Wash, but this becomes a temperature issue. So really, really hot rocks in the Cooper Basin or an old continent, very weathered, lots of -- I think I've got that right, Rebecca. I didn't think -- but this is a temperature profile. So normally, we're used to seeing geological profiles. But as we can actually drill horizontally here, so these wells will not work with vertical penetrations in 1 frac. We actually have to go horizontal. We have to frac it to get this resource if we're targeting it specifically. And we've been limited to being able to drill horizontal wells with the technology we need to use to be able to go horizontal and steer them properly. The temperature breakthroughs that we've been making with our providers continue to open that up. So as we get tools that work in hotter and hotter climates or hotter outer rocks, then those contours open up. We've got some good results. We're actually delivering a high side. I think Kevin talked about. It did start out very strong, but it has come down. It's doing about 2.1%, but it did start around the $8 million mark on that well, and we're continuing to push those. And we have a plan to do more wells in this area and continue it. So these -- both of these plays we've been working on for the last 2 years, and now we're now confident to show you the results on. So how does that fit into what we want to do with the infrastructure? I want to drill more wells there, I can't because they don't have the capacity. Moomba Central optimization, this is -- it sounds grand, it's not that grand. Getting rid of 3 manned facilities, the oldest ones we have, the most unreliable facilities we have and changing them out for electrified facilities that are remote operated, unmanned with very high reliability and creating capacity that we can drill more wells there and produce more gas out of this area, which is where I want to focus my cost. And even on a like-for-like change out of the equipment in that area, it's a 20% cost reduction without assuming the development opportunities that we have. That is purely like-for-like equipment cost operability. And then Northern Deep Coal, big play up here, really exciting. We continue to invest in it. We do have a lot of penetrations again through this as part of other wells that have been drilled. So we do have a lot of information on the Deep Coal. It's about how we actually exploit the Deep Coal cost effectively. We've just had a good result here with Gloss 1. That's a vertical well. We're playing our deviated wells, and we're going to learn as we go along over the next 2 years and go from deviated and then into horizontal. But we're sort of confident we'll get some good results out of the deviated wells, but we'll take that journey slowly, but that's a huge resource for us. And then Beetaloo. So this is -- this is 1 we're excited about, and we're starting to see other operators, so we're leveraging some of the work other people are doing up there. But we actually are in the sweet spot. We believe we have the sweet spot in the McArthur Basin. The Beetaloo being a subset of that. But we're talking tens of Tcf of gas, tens of Tcf gas. This is gas that would fill the LNG of Train 2 and keep GLNG full. So we want to spend some time making sure we develop it. It's scalable. We can ends up being something that we'll be good at. It's a drill-to-fill operation, but then we can plan our capital on. So again, fits very well into our operating model. It's -- the thing we also like about it, it's analogous to shales that are currently being developed with current technology in the Marcellus. So this isn't inventing the technology. This is leveraging technology that already exists, large scale in the U.S., and I'll show you why we think it corresponds to the Marcellus. Again, this can go north or south. It could go to Darwin, it's well positioned. We're looking to actually do some further appraisal in '26. And we're really excited about just how support of the new Northern Territory government is to actually exploiting these opportunities. So a fantastic resource for us. And I suppose just to give you a bit of detail. Look, this is just a type curve, but again, showing what's being developed in the U.S. and what we have seen from our well. So this is actually a well we drilled. And you can see it's very, very close to that. So lots of work being done, but we are confident this matches or is as good as a U.S. shale play that's currently being exploited economically on a large scale. And we've got a great bit of that post code. So look, just to summarize, we've got 3 LNG plants, fantastic privileged assets in great position linked to a great market with good relationships. How do we keep them full? PNG, lots of short term options that we're ticking off already. We've got long-term optionality as well. And again, to keep that going and potentially expand it out till 2040. GLNG backfill opportunities, not just using our foundation fields and increasing supply from our foundation fields, but looking at what we do with the Cooper going forward, particularly in an expansion case, and then with the Beetaloo coming in on the back end, lots of opportunities, lots of options. As Sherry said, we're blessed with options, but it's really up to us to decide how we play that out and what is the most economical way for us to spend our capital going forward. But certainly, from a scenario point of view, we can keep these facilities full, and this is the best place to spend money, putting gas back into facilities that are already built. So I hope that's given some confidence that we can continue to supply these 3 assets with gas, not just in the short term, but in the long term as well. So I'll pass it over to Alan.

Good morning, all. Thanks for the opportunity to fill you in on where we're up to on the Santos Energy Solutions side today, I want to cover 3 things today. Firstly, give you a reminder, of what's in the portfolio and the cash we're already generating from the midstream assets and the fact that, that is very privileged infrastructure was sitting on there. I'm going to talk a little bit about the moves that we're making towards building that commercial carbon management services business model at scale, which is a really important piece of the puzzle, and then just to talk through the portfolio development and importantly, the carbon price exposure, that's going to bring. Next slide, please. So just as a reminder, what's in the portfolio today is really the East Coast and then the northern part. So Eastern is centered around Moomba but integrated there in with Port Bonython as well. And then in the north, we'll talk to Darwin LNG already. But I think the point to make here is there's capacity in each of these facilities. They're contracted today on medium- to long-term contracts that generate really, really nice set of cash flows, but there's running room as well. So when Barossa comes online, that's going to make Darwin a bigger contributor into my bit of the business. And importantly, the low-cost operating model that we've talked about for upstream applies as much to the midstream part of the business as it does to upstream. We're very focused on bringing costs down and making out more margin. But importantly, Brett mentioned the Cooper optimization play in his part of the business, that's very much embedded in what we're doing in the Cooper as well. So that dovetails very nicely. Next slide, please. In terms of the portfolio we're building today, I've been in the seat for coming up to 18 months now, and I'm pretty proud of the way that we've made it a lot more targeted. We're not joined, there was a lot of activity around different prospects, different opportunities. And hopefully, what you see from the slides that follow today is we've really tried to streamline that, very conscious as well of the capital allocation framework that we've got. We're competing for capital with the upstream part of the business as well. So we've got to find projects that hit those hurdles. The big thing that's probably changed on the midstream side in the last 12 months or so, obviously, is Moomba CCS Phase 1 coming online. We've got revenue coming through from tolls there, and we'll get our first ACCUs in the early part of next year, which will generate more revenue. And in terms of the commercial model that we're looking at putting around that CCS portfolio, it's really simple. We're going to charge people CPI-linked tolls, and we're going to get carbon price upside. That has really got traction with customers and has simplified what can appear a complex conversation. And you can see there with the 3 hubs that we've got around Bayu-Undan, Reindeer and Moomba Phase 2, which I'll talk to about in a minute, that is really where we're focused. In terms of tech development, it's important to note that one of the constraining factors around CCS is market size, but not market size in terms of prospectivity, it's how you actually get the carbon in a pure enough form to where it needs to be for us to sequester it. So we've got to understand things like direct air capture, point source capture. You might hear it called post-combustion capture. These are not areas where we're looking to put huge amounts of capital, but if we don't look to understand those and look at how they can feature into the supply chain, we'll miss a trick. And then on the right-hand side, customer-led future growth, which is really around low carbon fuels. In the past, we've talked about numerous different options for that space, but we've really homed in on synthetic gas. You hear the Japanese refer to it as methane. But that's a product that can be used in existing supply chains, and we think it has very good prospectivity. Next slide, please. So this is a reminder, of the operated CCS hubs that we have, and we've really tried to simplify this. In the past, we've talked about them being CCS and low carbon fuel hubs in practice where we are today now as these are CCS hubs. We have low carbon fuel option at Moomba, which I'll talk to separately, but we've got these 3 hubs, 2 of which offshore with very close proximity to Asian emitters, but also onshore emitters in the case of WA as well. And I'll go through each of them one by one in the subsequent slides. But the way to think about these is huge, huge storage reservoirs, depleted reservoirs are an infrastructure of sorts. And when you combine them with the pipelines and the facilities that we've got at each of these locations, that presents a very, very compelling opportunity that we're looking to monetize. There's some mention on the slide here about the MOUs we've got in place. Not looking to make a huge deal of those today. We've got to convert them into binding contracts. But nonetheless, when we sign these, we enter into a unique dialogue with the customer. And they're structured in such a way that we look to progress them. If they don't go to a certain level, we then refocus elsewhere. So we're very, very targeted about who we speak to in each case. Next slide, please. So we're just going to run a quick video here, which shows the time lapse of the construction of Moomba Phase 1, and I'll make some comments on that after. [Presentation]

So look, as we mentioned earlier on in the piece, that's 230,000 cars equivalent a year taken off the roads, 10% of South Australia's state emissions on an annual basis and 5 years of hard graphs by a lot of people in the organization. And it's a project that we are super proud of as we should be, and it's acting as a catalyst because what it allows us to do is have conversations that are now much more steeped in sensible dialogue than the miss that were there before this came online. What we are very, very privileged on is the fact that we've got a South Australian government who is absolutely bought into what we're trying to do at Moomba, and please don't underestimate the value of that. You can see in other parts of the business, the challenges that we're having, getting approvals and getting frameworks in place and the like, but having that government support there and a framework allows us to do what I'm going to show on the next slide. So we've proved the concept now, and we're building credibility with that 1.7 million tonne run rate in Moomba Phase 1, and now where we're heading is Phase 2, which as you can see there, is 2 million to 10 million tonnes a year of additional volumes to be sequestered, that is going to be a combination of domestic and international supply to bring that in, it will require new infrastructure. We're working with the teams to do studies to ensure that we're putting those pipelines in the right locations. There's various options around that. But importantly, what we are doing as well is working very closely with international customers. We've announced a number of MOUs with counterparties from Japan and Korea in order that we can try and piggyback off the fact that their host governments are very, very supportive of getting CO2 across international boundaries. It does require our government to step up, so I'll talk about it a little bit on the subsequent 2 slides, but bringing international volumes to Australia is going to require action by the government as well. One of the questions I often get asked around international importation of CO2 is shipping. Clearly, that's a critical part of the supply chain. And if you look at the case study that's emerging in Europe at the moment around the Northern Lights project, modestly sized vessels, but nonetheless, they're bringing the chain together. Moomba is a very similar size, Phase 1 to the Northern Lights. And as you can see on the slide there, we'll see the first Korean built CO2 carriers come into operation in Q3 of next year. And actually, Japanese shipping lines have also piloted them as well. So whilst that is not in place at scale today, it is not something that is many, many years away. Next slide, please. So Bayu-Undan, this is a really exciting, large and scalable project. And I mentioned that point scalable because to FID this project, we're going to be focused on sequestering the 2.3-or-so million tonnes from the Barossa project later in this decade. And from there, what we will look to do is build for international volumes as well. We can take this up to 10 million tonnes. But the first thing, and this is my absolute focus for the next 12 months or so is getting the fiscal and regulatory regimes in place with the Timor-Leste's government getting the G2G arrangements in place between Australia and Timor in order that we can get the volumes into that depleted reservoir at Bayu-Undan, so a really, really exciting prospect and again, that linkage back to Barossa. Next slide, please. Western Australia CCS really has 2 components to it. We can make this project up to 5 million tonnes. But in the first instance, we're looking at the Reindeer CCS project, again, using the depleted reservoir there, which will be around 1 million tonnes. So we have made very, very good progress with a couple of customers, and we are moving closer to a binding arrangement for landing those volumes. We entered FEED in the first part of this year, and looking at FEED readiness in 2026, again, targeting first injection at the back end of the decade. Working through the approvals very much in the same way as Bayu-Undan, this one is a little bit simpler because it has that pure Australian perspective to it, but we have made good progress on FEED in particularly the engineering studies, and we recently lodged with the regulator, what's called the declaration of storage formation, which is effectively a precursor to applying for an injection license. So that's tangible progress. Next slide, please. So coming back to Moomba now and the low carbon fuels project, where I said earlier on in the presentation, how we've really looked to focus in on a particular opportunity in low carbon fuels, not be all things to all people. I suspect people in the room have been tracking the reality check that has emerged around hydrogen in the last little while. We are not anti-hydrogen. We think it has a role to play. And indeed, in the synthetic fuel production that we are looking to develop hydrogen will be part of that chain, indeed, combining it with CO2. However, it's the transportation method that differs here and it's a very, very major competitive advantage because you can avoid all of the very prohibitive costs associated with having to develop new infrastructure for hydrogen and blend or drop in these fuels into existing supply chains. So whilst we've worked initially with Japanese utilities, the top 3 Japanese utilities, this is a product that we could use that our JV partners could use that domestic customers can use and you can evacuate it through existing infrastructure. So whilst it's not where it needs to be on the cost scale at the moment, it is something that is increasingly prospective and part of our portfolio. Next slide, please. So I'll use this slide to really bring together what I've said. Kevin introduced this at the front of the pack, the carbon growth storage targets that we've set, around scope-free equivalents. And the take you through really what this means in practice is that we are now, have a target to sequester safely and permanently around 14 million tonnes of CO2 of third-party CO2 by 2040. It's an ambitious target, make no doubt about that. But the reason we've got confidence that this is deliverable is really 2 things: emitters are looking for physical solutions to decarbonize, especially in hard-to-abate sectors. So the conversations and the dialogues that I referred to earlier in the presentation give us confidence that as we get through the next few years, there is going to be demand that is going to uptick as well. If you look at the IEA numbers out to 2040, even though this looks like a nascent marketplace today, what you can see there is it develops, and it plays a very, very major role in decarbonizing this part of the world. So we've committed to that. Final slide, please. So just to reiterate some of the things I've said, we're blessed with a contracted cash flow generating portfolio of Midstream assets, we're starting to generate ACCUs, which brings a new complex to the business. It's privileged irreplaceable infrastructure, and we're going to backfill and repurpose around that. We're building that commercial carbon business to third-party supply, and we're going to do it at scale. That's the pathway we've discussed, and we will exercise portfolio discipline, make no mistake. That's all I had. I think we're now going to Q&A.

Okay. Well done, Alan, thank you very much. I think you're just staying up here. Thank Ken. Yes. If I could ask Sean, Sherry and Brett, I think, to join us up on the stage and we'll go straight to Q&A. Like I said at the beginning of the day, if we could limit to 2 questions each, please, because there will be a number of people I'm sure with their questions. Just let the presenters take their seat. And I'm going to throw a lot of the questions to the team here, make them earn our corn today. So go for who's Dale. Dale go first.

Dale Koenders from Barrenjoey. Thanks for the updated capital allocation framework and comments. I guess I just want to tie back to some other comments you've said in the past, Kevin, around 6% CAGR in growth, growth really wasn't much of a conversation. I don't think you mentioned with Dorado today. How are you thinking about that outlook for and progress for growth projects? Is it still unchanged its views on spend on growth still unchanged?

Well, look, I mean, I think I'm going to throw it to you, but you asked me specifically, so I'll start with this one. I think Dorado is just in the bucket where the rest of the projects is going to compete. And what we're seeing is that our disciplined operating model, which has been applied to our operations essentially for the last sort of best part of a decade under the new capital allocation framework means that every project has got to fit within this new framework, and they will be competed for capital be certain prioritizations. Obviously, in the short to midterm, we're going to lock down those backfill strategies for the LNG facilities, and so they're going to be prioritization there. And then whatever is remaining in those capital ceilings and I'll hand to Sherry talk about that. All of those projects will compete for that. So I think what we'd be seeing is on a go-forward basis as opposed to trying to think of everything piling on and growing rapidly in the short term and doing everything at the same time and chasing production. We're chasing shareholder return growth over production growth over barrel growth. And so from that point of view, it's probably a more sustainable growth rate in the future and not chasing everything at once. Sherry, what do you want to add to that?

Yes. I think you've said it perfectly with that example. I think the only thing I would just underline is that as we move out of this major growth phase and given all of the optionality we have, it's a wonderful problem to have, and I'm looking at Rebecca, who heads up our portfolio team that's in the audience with us today is that we're really moving towards, which is another reason why we wanted to roll out this framework today. You don't just make these decisions when the projects are ready to take FID. What you do as an organization is think carefully about how we phase the de-risking and the maturation of those projects even before we get to FEED and certainly before we get to FID so that we're spending phased capital in a prudent way, progressing the projects that have the best chance of going forward, and parking the others so that we don't burn too much development spend while we're getting those ready to go. Dorado is one example, but...

Yes, that's a really good point. You can spend a lot of money in FEED studies and keeping everything warm, and trying to have all the balls in there at the same time. So I take everything forward at the same time even if you're competing for capital when it comes to making those FID decisions. What we're trying to do is bring a discipline in the organization where we really get that road map and that funnel laid down in front of us, and we're not working on everything at the same time. Some things will just have the go on the shelf and their day will come. We're not panicking. We don't have the develop everything tomorrow, but we do -- we will develop our best opportunities within the new capital allocation framework.

So if we bring it back to a slide you presented at the half year around a 15% to 20% free cash flow outlook, which included growth CapEx in those numbers, are they still the right numbers for us to think about? Like you haven't slowed growth because that's quite a compelling return if you're paying 60% to 100% of back to shareholders.

Well, the same free cash flow from operations assumptions would apply. So I'd have the go back and check for this new cap because since we're putting a cap on the CapEx. But there wouldn't have been too many of those projects coming online in that time frame anyway. If you think about it, it was really Barossa and Peak driving those...

That 15% in the half year pack, it included growth CapEx in those numbers.

So Yes, yes. But what I'm saying, including growth CapEx, and I would suggest that, that growth CapEx might be less than it would have been in that chart. We can confirm that for you the actual numbers, but I would suggest given that we're going to put a ceiling on growth CapEx, it would be less. Less growth CapEx just to be sure. No misinterpretations. And we refer to it more as development CapEx as opposed to growth because it's not always growth. And I think the other thing to think about as opposed to thinking we're chasing production at every asset, we're chasing on that overall portfolio picture. So it's about backfilling that production hopper as opposed to backfilling every asset at the same time. Next?

Tom Allen from UBS. I was hoping you could share some color, perhaps, Sherry, just on your appetite for, under the new capital framework for buybacks versus base dividends. And under what scenarios you might preference buybacks versus base dividends? And then also just a refresh on how you're thinking about the hurdle rates for some of those key growth opportunities that you're looking at?

Can you repeat that second part of the question?

Second part was just a refresh on the hurdle rates for some of your key growth opportunities.

Okay. All right. So on the first question, it's always something, and I've mentioned it in the slide. So just to reiterate, it's already built into our framework even under today's allocation methodology that will always look in each period at whether or not a dividend and/or a share buyback is the best outcome. So that's not going to change over the cycle. There's many things that feed into that in terms of how the market is developing, how our share price is evolving, et cetera. So that's unchanged. And we understand that there are some of you that love to have a buyback, others prefer dividends. So that's always something on balance that we'll take into account. In terms of, if I understand your question on the hurdle rate, we don't disclose the specific methodology or hurdle rates that we apply for each project other than the say we try to make sure they're very, very competitive over time, both on an absolute basis versus each other and also at very conservative commodity prices, and that will link into comparing those back to the alternative of a shareholder return either in the form of a share buyback or a dividend.

And Alan, I mean, you might want to talk about when it comes the hurdle rates, are you any different from Brett's?

No. I've mentioned that briefly in my presentation. We're very proud of the returns that Moomba CCS Phase 1 is generating, and it has carbon price upside as well. So we can find projects. We'll be selective about what we do, and we'll be patient.

And I think that's in Alan's area particularly, really hone down the number of things that they're working on in that group and driven a lot of focus that we only should be working on if we're going to screen, right? I mean we're not going to build CCS projects that don't work commercially. That's not -- we're not going to shrink our way to success, so to speak. So they've got to work commercially. And we've got a good commercial model now. We've engaged with customers -- or potential customers, I should say, who are engaging on that basis. And so we're very confident we can build good return CCS project in the future. And so Alan is competing with Brett, with Vince Santos finally on the West with Bruce and Alaska for those funds in the future.

James Byrne from Citigroup. So I wanted to pick up on what Dale was asking just around the capital allocation.

I was looking for you James. I couldn't think...

So look, there was a slide with group production, and you get to that peak in 2026, and then it's like a 3% per annum to clients. That's good. That's not very capital hungry, in my opinion. You get to March 2026, I think it is. You've paid off PNG, LNG project finance, you got a big step-up in free cash flow to equity, which helps to gear. So I can certainly see why you're prepared to go and pay 60% minimum of your free cash flow all in to investors. But if you actually step back and look at oil and gas companies and the ones that have delivered the best TSR over the decades is the ones that focus on cash return on capital invested actually feel like maybe things are a bit backwards in this capital allocation framework where you've actually prioritized the shareholder returns as opposed to [indiscernible]. And I get the point that you don't want to go invest in mega projects consistently right and never really have that free cash flow or volume for volume's sake, right? Maybe I'm a bit greedy. I want valuable volume, not a choice between value and volume. So my question is, do you not feel that you've constrained the capacity of the business to have a higher [indiscernible], and secondly, I guess it would be helpful to maybe go a bit deeper on how you're actually approaching that annual budget for that capital ceiling. Like what are the key determinants that you're looking at?

Yes. Well, thank you.

That's a good one. I'll like that. [indiscernible], Sherry.

No, I think you've in the way answered the question, because that was exactly the deliberation we had. And I think the context that we really can't underline enough is that, indeed, if you don't have a very healthy funnel of low-cost and phaseable options in the portfolio, you do end up being in this trade-off situation where either you can have a very strong shareholder return today and you can go off a production cliff in the next x number of years, which could be a very short time interval or you go into a major growth cycle with some reward far out into the future. And the work that we've done over the last 10 years to build up a portfolio where we've got, as you've said, a very stable production base already baked as soon as Barossa and Pikka come on stream, and we've got a nice collection of geographically diverse mix between short circle cycle and long cycle investments. And just about all cases, really based on brownfield expansion or backfill gives us that luxury of choice to be able to not constrain valuable growth, both in the next 5 years but also for decades to come, but also over that cycle to offer a very attractive return. So it's really that delicate balance that not a lot of portfolios are able to provide, but because of that healthy funnel and the base we have today, we can strike that balance.

And I think if you think about our -- by the way, it's not saying we're not going to invest, we are going to reinvest, maybe just not as many projects simultaneously because we don't have to. We don't have the do that to maintain production. If you think about what we got going on today, we've got more projects than just Pikka and Barossa. You had the Angore project. It's a $1.2 billion development we had SPA Halyard infill wells going on in the West offshore program in the West. We've got the KMP FPSO project, our FSO project in PNG. And there's a number of other maybe medium-sized projects in the portfolio and execution. Right now, today, that's soaking up CapEx. And so it's really just about saying, once we get over that sort of next phase, this growth or the 2 big projects, which give us a much more balanced portfolio in terms of free cash flow contributions coming out of Alaska, coming from Darwin from Barossa as well as PNG because now PNG and GLNG is kind of paying for everything right now, right? And I always said I did not want to have a single asset company, we don't have a single asset company. But right now, we've got a couple of assets that are carrying a lot of the weight. From next year, we've got 4 assets much more evenly distributed contribution to the portfolio. And that's where we want to be because in 2018, when the earthquake hit PNG, all of Oil Search's revenue stopped the day the earthquake shut it down, our PNG asset went off-line, but 4 others were contributing positive cash flow at that point in time. And so you got from a risk point of view, you don't want to be too heavily weighted to 1 project or 1 asset. So how we will invest in the future, all of those things will be considerations. Something to consider, James, which I think goes to the heart of your question, is 3 of those assets in terms of certainly 2 today, GLNG and Cooper Basin, if you think of them for the East Coast or short cycle sustainable CapEx assets, not a drilling program every year. And so they're much more predictable and they're much more manageable within the capital allocation framework. It's really sustaining CapEx you're spending there. Once Alaska comes online, it's not quite the same, but it's not a million miles different. It's about 1 drilling rig drilling every year, and drilling of 15, 20 wells a year going out of Phase 1 and in Phase 2. There's a little bit of infrastructure you're going to build for that expansion when we go down that path in the future, but that's a few years off. And if we are successful in developing the Beetaloo, then whether it's backfill and up fill, I guess that's the term I would use for GLNG and/or expansion gas for DLNG, that is another short-cycle CapEx asset, which really lends itself to this model. And so you're left with any major growth in Alaska and WA as the assets that really are more that what I'd call long-cycle boom-bust type of asset in the portfolio. The rest fits to that short cycle, more sustainable CapEx operating model.

So on the remark around stable production that you've already got baked in, if we think about that PNG chart, in fact, whoever is in control of the slides may be helpful to bring up. I think it was Slide 47, PNG chart. It basically shows production from existing 2P reserves. And then there's a gray section above, which is the undeveloped price...

Unsanctioned, yes.

Correct. And part of the, being the bonnet that I've had around the segment in PNG is that I fear that there's very high production that's forecast within the consensus estimate not necessarily the CapEx that's required to keep it full. And if I look at when that gray actually starts, in 2028, right, and starts to get wider and wider, I fear that the equity markets forgotten about the CapEx required to get that. So 2 specific questions. Does that 2028 include the APF tie-in in the blue, which is 2P reserves or in the gray. And then secondly, like how do you think that ways in equity market should think about the CapEx intensity of what you've got there in the gray?

So yes, so APF, because we actually, you could say it was sanctioned at PNG LNG sanction as part of the unitization. But ultimately, we haven't made the commitment on the expenditure yet, so it does fit in the gray. And again, it's a choice for us to decide when, along with the other joint ventures. And then really, the projects that we have baked in there it's an upside and a backfill chart. So we have...

It described what APF is because it's not a major upstream development, it has already been developed...

So look, it's 1 or 2 wells in a 30-kilometer pipeline. Ultimately, we are looking at whether we can do a low CapEx version of that and put some of the CapEx in a little bit later and start off with lower production upfront, but that's just a work in progress. But ultimately, the base case that's baked into here is a 250 million scuffs a day connection with a 30-kilometer pipeline. So it's a pretty simple low risk to evacuate a field that we've been producing for the last 25 years, albeit producing the oil and reinjecting the gas back into [indiscernible], so very little subsurface risk, and it's really an operational executions. So that's baked into the gray. So it's not included in the 2P in the blue because we actually haven't got any ability to exploit that right now with no pipeline build. And then ultimately, the projects that I showed you of Papua and P'nyang, baked into sequentially into that gray.

And just to add to that for absolute clarity, because I had mentioned in the indicative profiles that we put out that show us within that 100 million to 120 million-barrel range. We put the low CapEx APF alternative in that just to show how that really is a subset of sustaining, if you like, in terms of the type of spend that is versus the major project development. So that's a larger opportunity...

And sorry, Sherry, what I was trying to allude to when I was talking about Papua was we actually get significant value not through production in Papua, but actually through tolling and access agreements, which you don't fully see in this. So you only see a small increase in production. We're at 17.7% post government back in. So from a cost point of view, we're only 17.7% of that exposure. And ultimately, I'll let Sherry talk to, but there would be a strategy on project finance for that as well.

Mark Wiseman from Macquarie. Just 2 questions. Firstly, on the capital ceiling. Could you help us understand how that formula is going to work. You talked about stress testing at lower oil prices. Would there be enough room for Papua LNG to move forward because that's one that's less in your control in terms of timing, can you pursue Papua if that takes FID and other projects? Or would it really just be Papua for that period?

Sherry?

Yes. Thank you, Kevin.

Welcome to Santos.

So Papua is an example. Obviously, when we've thought through and thought through very hard how can we make sure that when the model spits out the back end that this is an upgrade in terms of how we look at dividends versus the back end, that would be one of the scenarios that we would look at as Papua moving forward. Clearly, subject to the recycle of the project and how the economics come out, that would be one big one. It wouldn't leave room for another Papua at the same time. I don't think anyone would run a model that would tell you that, but that's just one example, and the framework will apply if Papua is moving ahead, if it's moving ahead as backfill if any other scenarios are running through. And so we've modeled all of those scenarios, as you say, at a conservative commodity price, but that's also why we don't tell you what the ceiling is now because there's lots of work that's needed still that will happen, over the next year before we come into 2026, both on that project with our joint venture partners, but also across the entire portfolio to select and progress which projects and how they fit into that ceiling. One thing I can say, and Kevin and I are very clear on this. There's a little footnote in one of the slides that says the capital ceiling is subject to Board approval. And you might say, well, what's the point of that? They approve the budget every year. But the fact is that we won't they're go in that room and ask for a capital ceiling that spits out a dividend that's not at least as competitive, if not more competitive than it is today. So that puts what we think are very, very healthy, transparent, belt embraces on us as a management team and how we work together with each of the project proponents to progress those projects so that what goes forward to Board after all that work is something that fits that model.

Yes, it's great to see that discipline. Just my second question on GLNG. When the CoGas contract expires, I think the market has been a little uncertain as the what the future would be for one of those GLNG trains. That production chart that you showed, including the Beetaloo is huge. Could you maybe just unpack how are you thinking about that decision whether the close the GLNG train versus the economics of developing your Queensland and Northern Territory Resources?

Brett, do you want to talk to that?

Yes. Well, look, I mean what I tried to show today was that the opportunity set that we have that would actually be able to continue not just to backfill our 6 million tonnes. But as Kevin said, upfill. So there's capacity there and the cheapest LNG liquefaction capacity anywhere is in LNG that's already running. So I think that's the upside for us. So I would like certainly like to say is have the opportunity to try and fill that train before we talked about turning it off, and I think you can see not just from our longer term Beetaloo aspirations, but even in the shorter term, our 5 fields have the ability to take a lot and carry that through. So ultimately, we're going to have discussions about where capital is spent. But to me, we've got a very real scenario where we continue to put the same amount of gas we're putting through today, if not more.

I mean I think the story of GLNG has been one is there's been a lot of lost opportunity because we didn't have enough gas to fill those contracts. That's a fact of life, right, and we weren't able to exploit those contracts to the full. How we created value from the starting point in 2016 was cost out. So we couldn't create magic gas. It wasn't there. But what we could do was get the cost of producing that gas down the cost of the wells to drill in the upstream. And we did a lot of work in GLNG over the years to do that. And so we've made it a good project at 6 million tonnes per annum, but we know we've got a capacity of, we could run that at 8.4 million tonnes per annum. That's a lot of lost opportunity. And so we've been working for a number of years as to how can we fill up GLNG? And there's no easy solutions to that. There's a lot of gas in Queensland, but it's tough, right? It's tough more coal seam gas to the north, tight gas in the Bowen Basin, they're all tough prospects to develop, and you can spend a lot of capital chasing that. We've drilled a few wells up there testing those things. But the 1 player that we've tested, and we need to do more appraisal of that gives us a potential to do that and be the breakthrough play that can fill this long term is the Beetaloo. The Beetaloo has the potential. We've done the extended well test in [indiscernible], I think it was. And we've seen some of the results from some of the other players in the basin. We believe we're in the sweet spot. We've got a very, very good address there in the Beetaloo and the McArthur Basin. And so over the next few years, we want to test that when we prove that up, the development of it will be quite simple. It's a pretty low CO2, low processing requirements for that gas. It's really well in our pipeline to wherever you're going to take the gas. So a very simple development, not cheap, but simple. And we think it's got the best potential to fulfill that and give us the ability to scale up beyond that if we wanted to. So what that means -- what's the focus on that in the next 2 or 3 years. We've changed the way we engineer projects. We use -- our industry used to design them, get contractors in, engineer them to death, have a design spend a lot of money, sometimes hundreds of millions of dollars designing it, then go get your approvals. And we've seen how that sort of worked out for us elsewhere in the last couple of years. So we've turned that process on its head now. And the next 2 or 3 years, just as we're doing in Narrabri today, the majority of our effort will be spent on getting approvals for pipeline easements. The things we need to develop the Beetaloo as opposed to doing all the engineering ahead of the game, right? So we'll get all the approvals, we'll get what we need to get in place so that when we do start spending hard cash, we know we can build it at the end of it. Next, please.

Gordon Ramsay, RBC Capital Markets. Kevin, I don't think it's fair that I asked Sherry this question because he's so new. Last year, at this time, you were talking about return on average capital employed by 2028 of 15% to 20%. Your parameters were $75 to $90 Brent oil price and a $12 to $14 JKM price. Does that still hold?

Look, I think for the project assumptions we made them -- those price assumptions, I would say, yes, that still holds. If anything, most of the projects we've worked on have got better over time in terms of the IRRs on those projects. So provided we don't blow that elsewhere, Gordon. I'd say yes, that would hold. Those assumptions sound robust.

Okay. And my second question, Beetaloo Offshore has talked about a $100 million to $150 million increase in terms of the FPSO costs. Is that cost solely payable by them? Or does that come back to Santos?

That's their contractual issue. And we're very aware of the challenges that they've had in the shipyard. But we have a lump sum contract for the construction and a lease operated arrangement for the next 20 years or 15 years, whatever it is, for that asset. And so that is their contract not ours. But I do want to say that our working relationship with [ Beetaloo ] is very positive. It's a very strong relationship. We don't want them suffering. And I think it's probably gone a little bit beyond them just losing their margin on it, probably a little bit in the red in that, that's unfortunate. But contractually, there's no kind of follow through for us there.

Rob Koh from Morgan Stanley. So congratulations to the whole team on the commissioning of the Moomba CCS facility, particularly because I think this time last year, Kevin, you made a joke that you wouldn't be here if it wasn't up and running, which no one would have held you to, I'm sure I wouldn't have. Can you maybe give us some color on the learnings from the process because it wasn't a straight line as all development projects aren't? And also, you've talked about how you'll take some of those learnings to the Bayu-Undan CCS. So you could maybe just give us some color on...

Yes. Well, first of all, I just want to make the point on 9 out of 10 metrics, Moomba CCS was a roaring success. On one, it was not, that was cost. We spent more than we said we would deliver on it. And I'm partly responsible for that. And so I just want to put that out there. I said to the guys under no circumstances, does this start-up and shutdown start up and shutdown, I want a flawless startup. And Brett and I discussed this at the big turn of the year, and we said, so through every resource we have at this because we do not want that, we know how that would be used against us in terms of the arguments that CCS doesn't work and all that sort of stuff. So we had to get it right first time. That cost us a better money. There was some other inflationary impacts and everything else. When you have a low CapEx project when it blows out by $10 million, it's suddenly a big percentage on a low CapEx project. And so there's that. But we did take a very conscious decision that we weren't going to press the go button until every rock had been turned, every I dotted and every T crossed, and that cost a better money at the end. And so that was just a tactical decision that cost us money. And so that took the breakeven from that $24, that we would have said life cycle breakeven, $24 at FID to $28 completion. And so that's a $4 increase in the [ PV-10 ] breakeven. We thought that was a price worth paying. We thought in the interest of our shareholders, that was a price worth paying. Now I turn to Shawn and say, Sean, what does the Moomba CCS project means for you in the marketplace? What does it mean for you? When you talk to LNG customers and stuff?

It's incredibly important from a long-term contracting perspective. In fact, I've joked with Brett and Alan that we could probably augment the difference between the 4 and the 8 by selling tickets for customers to come and visit Moomba because it's probably the most interesting asset we have in the portfolio from a buyer's perspective. So I touched on before. We're looking at abated product, abated LNG. And the center of that opportunity is really move the CCS and they can see that we've delivered that and then we can move from for that.

Yes. No, thank you. I thought it was important. So one of the lessons was how important this project was globally to a lot of stakeholders, a lot of eyes on this project. And I guess, we've probably got a lot of activists to thank for that, for throwing so many rocks and making it such a high-profile project. But ultimately, what that meant a lot so it had to be right first time. I think the other thing is that we -- Alan mentioned, the regulatory environment and how important getting that right first before you start these projects actually is and getting the support of that [ regular ] and Alan, what are the lessons that you're taking to Bayu-Undan CCS from Moomba CCS?

Yes. To really think about it in 3 buckets as the engineering, which maybe Brett can talk about, there's the regulatory and then there's the commercial. So on the regulatory side, you've got to get out ahead of it. With the South Australian government and the federal government at the time, both being supportive of Moomba CCS when we took FID, 2 huge ticks. So we are working very, very hard now to get exactly the same in place for Bayu-Undan that involves a whole heap of stakeholders, all of which we're engaged with and making progress on. It is very, very closely linked to the commercial model, though because everyone is looking at the available dollars, and what has worked well on Moomba CCS is a toll plus common price upside. And that is the model that we are looking at for all of our projects as well. So we've got learnings from how that comes together and what economics need to work for both sides.

Brett, do you want to add anything?

Yes. Look, I mean, I think it's just an example of the best -- culturally, what we do really well. I saw the best side of Santos during the commissioning. We really needed to get behind it. And I didn't see a group or a department or a function or whatever that didn't give us what we needed to make it successful. And everybody, we've got incredible depth in the organization, the folks that actually came down that commission compresses like this on an annual basis out of CSG, our best guys, we made them available for Moomba. Steve's process safety team, Rebecca's subsurface team, it just highlighted and showcased the absolute depth in the organization. When we need to solve something and get it running perfectly because perfection was success here, something that worked 95%, [indiscernible] and I spoke about at 95% of failure. It has to be 100% and the way it was. And this is a new thing to do, right? You could in the end, say, we're still, we're running compression and dehydration and pipelines and wells, which we're very good at doing, but we're running a supercritical fluid like CO2 through it. We're running it through. It has its own hazards. The way that was all done. And we didn't turn a dial on that until everything was to the satisfaction, not just from the team, but independently verified. Like I say, it's probably an example of the best of Santos in one snapshot.

And without going any details, and also we've recently just done our annualized staff perceptions of engagement surveys, and we've got record results. And I think the, in terms of the levels of engagement in the organization, I mean really, really up there. right across the entire company, real improvements over just a couple of years ago. And I think a big part of that is coming out of COVID, people are very concerned about having to come back to the office probably was one of them, but very concerned about what the future look like. I think, generally speaking, and you'd see that in other parts of your lives as well, but very concerned what the future for our industry was. And all the talk was about shutting it down, decarbonization, replacing it with something new even though we didn't quite know where that new thing was yet. And I think it's been really good for the morale of our organization to see this project come online and be successful. And so don't underestimate the commitment of our people, our people to decarbonizing our operations as we go forward. And I do believe you saw the stats, I think Sean talked a bit about what the IEA themselves are seeing. The energy mix will be in the future and how much abated gas will make up of that LNG and that gas mix in the future. And I think abated gas is going to be a big part of that energy mix. Now look, I'm very aware that we've overshot of the time. I apologize. My time management skills are legendary poor, so I apologize for that. So we're going to wrap up at that. And I think there's lunch being served outside. So please, if you didn't get an opportunity to ask a question, apologies for that, but very happy to take any questions outside over lunch. Thank you again. I'm going to ask you a very intimidating looking bunch. You really are, very intimidating looking bunch. Can you give the presenters a round of applause, please. Thank you. Thanks very much.