The Santos Ltd (ASX: STO) share price is marching higher today.
Shares in the S&P/ASX 200 Index (ASX: XJO) energy stock closed yesterday trading for $6.96. In morning trade on Thursday, shares are changing hands for $7.05 apiece, up 1.3%.
For some context, the ASX 200 is up 0.9% at this same time.
This follows the release of Santos' third quarter update for the three months ending 30 September.
Here are the highlights.
Santos share price marching higher on results
ASX 200 investors are bidding up the Santos share price after the company reported a 6% quarter-on-quarter lift in free cash flow from operations to approximately US$400 million.
Sales revenue of US$1.3 billion was down 3% from the prior quarter, impacted by a 3% fall in production to 21.6 million barrels of oil equivalent (mmboe).
Capital expenditure of $709 million for the three-month period was down 8% from the prior quarter. And gearing was reported to be 21.7%, or 25.0%, including operating leases.
On the major project front, Santos' Moomba Carbon Capture and Storage (CCS) project completed commissioning during the quarter. It's now online and storing CO2 in Cooper Basin depleted reservoirs at full rate. Santos said it expects to inject approximately 250,000 tonnes of CO2 in 2024.
Santos' Barossa Gas project is now more than 82% complete and on track for production in Q3 2025. Pikka phase one is now 67% complete.
What did management say?
Commenting on the results helping to support the Santos share price, CEO Kevin Gallagher said, "Free cash flow from operations of almost US$1.5 billion year to date creates a strong platform to provide solid returns to shareholders, backfill and sustain our existing business, and continue to grow our Santos Energy Solutions business."
Gallagher added:
Our oil and gas development projects also continue to deliver to plan and will be well positioned in an Asia Pacific market with ongoing strong demand for oil and gas…
We now see line of sight to our major projects progressively coming online, putting us in a strong position to deliver stable, long-term production and sustainable, superior shareholder returns.
What's next?
Looking at what might impact the Santos share price in the months ahead, the company said it expected production volumes for 2024 to come in the top half of its guidance range of 84 to 90 mmboe.
Sales volumes are expected to be 87 to 93 mmboe.
Santos share price snapshot
The Santos share price has hit some headwinds in 2024 amid slumping global oil prices. Year to date, shares in the ASX 200 energy stock are down 8.2%.
