Second Quarter Report for Period Ending 30 June 2021

Record sales revenue and strong free cash flow

• Strong base business performance and improved commodity prices delivered record quarterly sales revenue of US$1.1 billion and record first half sales revenue of over US$2 billion
• Second quarter production of 22.5 mmboe was nine per cent lower than the first quarter, primarily due to completion of the 25 per cent sell down in Bayu-Undan and Darwin LNG to SK E&S on 30 April 2021, partially offset by stronger gas production in Western Australia and Queensland
• First half production of 47.3 mmboe was 23 per cent above the corresponding period and sees 2021 guidance narrowed to the upper part of the range
• Continued growth in GLNG equity gas production from the Roma and Arcadia fields supports annualised LNG production above 6.2 mtpa for 2021
• US$270 million in free cash flow in the second quarter, bringing first half free cash flow to US$572 million
• Initiated major workstreams for the Barossa gas and condensate project, including cutting first steel for the FPSO turret, commencing manufacturing of subsea and export flowlines, and assembly of subsea trees
• Entered FEED phase for the Dorado integrated oil and gas project
• Issued US$1 billion 10-year senior unsecured fixed rate bond in the US 144A/Reg S market
• Strong free cash flows reduced net debt (including leases) to US$3.4 billion and gearing to 32 per cent at the end of the quarter
• Signed MOU with Eni to cooperate on opportunities in northern Australia and Timor-Leste, including re- purposing Bayu-Undan into a carbon capture and storage (CCS) hub for projects in the region with a potential capacity of ~10 mtpa of CO2
• Awarded A$15 million in funding for the Moomba CCS project from the Australian Government’s Carbon Capture Use and Storage Development Fund. The 1.7 mtpa Moomba CCS project is FID-ready, subject to confirmation of eligibility for Australian Carbon Credit Units

Key growth milestones achieved and balance sheet strengthened

Energy transition to cleaner fuels

Santos Managing Director and Chief Executive Officer Kevin Gallagher said Santos had delivered another strong quarter of production, sales volumes and revenues, as the business benefited from stronger demand and higher prices. Domestic gas sales volumes were up 7% as we responded to higher customer demand.

“Our disciplined, low-cost operating model continues to drive strong performance with US$572 million of free cash flow generated in the first half, and the business remains on track to deliver a free cash flow breakeven oil price of US$25 per barrel this year. At current oil prices, Santos should generate over US$1.1 billion in free cash flow in 2021.

“Consistent with our 2021 strategic priorities, after taking the FID on Barossa in March, we completed the sell-downs in Bayu-Undan and Darwin LNG, and have now commenced all key workstreams on Barossa as well as entering FEED for the Dorado project. As I have always said, we will remain disciplined and cost-focused during this next phase of growth. Despite cost challenges across the industry, I am pleased that our continued focus on costs sees a lowering of our upstream production cost guidance.

“The Moomba CCS project is FID-ready, and we are actively exploring CCS opportunities at Bayu-Undan and the production of zero-emissions hydrogen at Moomba. These projects provide a competitive advantage as we seek to decarbonise our oil and gas assets on the path to net-zero emissions by 2040,” Mr Gallagher said.

Comparative performance

1 Capital expenditure including restoration expenditure but excluding capitalised interest.

Sales volumes (Santos share)

Second quarter sales volumes were lower than the prior quarter primarily due to completion of the 25 per cent sell down in Bayu-Undan and Darwin LNG to SK E&S at the end of April, partially offset by an increased number of liquids liftings in Western Australia, higher third-party crude volumes and higher domestic gas sales. Sales volumes in the second half are expected to be lower than the first half due to the Bayu-Undan sell-down, with guidance narrowed to 100-105 mmboe for the full year.

Sales revenues (Santos share)

Second quarter sales revenues were a record and higher than the prior quarter, reflecting improved commodity prices partially offset by lower overall sales volumes due to the Bayu-Undan sell-down.

Average realised prices

The average realised LNG price was higher than the prior quarter reflecting the linkage of sales contracts to an improving lagged Japan Customs-cleared Crude (JCC) price, but offset by lower JKM spot prices. Three-month lagged JCC averaged US$56/bbl in the second quarter compared to US$44/bbl in the first quarter. Santos’ LNG projects shipped 63 cargoes in the second quarter, of which ten were spot cargoes from Darwin LNG (9) and PNG LNG (1).

Production by asset (Santos share)

Production by product (Santos share)

Second quarter production was lower than the prior quarter primarily due to the 25 percent sell-down in Bayu-Undan and Darwin LNG to SK E&S completing on 30 April 2021. This was partially offset by stronger oil and gas production in Western Australia and higher gas production in Queensland. Although production volumes in the second half are expected to be lower than the first half due to the Bayu-Undan sell-down, strong production performance across the portfolio sees the production guidance range narrowed upwards to 87-91 mmboe for the full year.

A data worksheet containing unaudited quarterly sales, revenue, production and capital expenditure tables in Excel format is available on Santos’ website.

2021 Guidance

Production and sales volume guidance are narrowed to 87-91 mmboe and 100-105 mmboe, respectively. Capital expenditure guidance is unchanged with spend expected to be weighted to the second half. Production cost guidance is revised down to $7.90-8.30/boe. Depreciation, depletion and amortisation (DD&A) is expected to be in the range of

$1.15-1.25 billion in 2021, higher than the prior year primarily due to higher DD&A in Western Australia due to the write- down of Reindeer gas reserves in 2020.

2021 Half-year results

Santos will release its results for the half-year ended 30 June 2021 on Tuesday 17 August 2021. The first-half report (incorporating Appendix 4D) and associated investor presentation will be available on Santos’ website at . A webcast briefing including investor/analyst questions will also be available on Santos’ website from 12:30pm AEST on 17 August 2021. Financial information included in this report is unaudited and subject to finalisation of the company’s accounting and audit processes, and Board review. As such, actual results for the half-year ended 30 June 2021 may differ from the information given in this report.

Western Australia

Domestic gas production and sales increased in the second quarter reflecting increased contract and spot market demand.

Oil production was higher in the second quarter due to start-up of the Ningaloo Vision FPSO in late March. Cyclone avoidance activity in early April required shutdowns of both the Ningaloo Vision and Pyrenees Venture FPSOs. Ningaloo Vision then commenced a planned maintenance shutdown in late June. Sales volumes and revenues are higher than the previous quarter reflecting increased liquids liftings.

The three-well Van Gogh infill drilling campaign commenced in the second quarter and is on track for completion in the fourth quarter. Drilling and completion and tie-in activities have been completed for the first well, with start-up expected in the third quarter of 2021. A better than expected reservoir outcome was realised in the well, with a total horizontal section of 5,430 metres across the two laterals, almost 500 metres of additional reservoir section than originally planned. The Valaris MS-1 rig has commenced drilling activity on the second well in the program.

As previously announced, the Dorado development moved into FEED in June with a number of key detailed design, procurement and regulatory approval work fronts being advanced. Major FEED contracts for the FPSO and the Wellhead Platform are expected to be awarded in the third quarter. The project is targeting a final investment decision around mid- 2022. The initial phase of development will involve gas reinjection to maximise liquids recovery ahead of a second phase of gas export from the field. This future phase of gas export offers backfill supply to Santos’ existing domestic gas infrastructure in Western Australia.

The Noble Tom Prosser rig is scheduled to mobilise to the Carnarvon Basin late in the fourth quarter to drill the Dancer prospect, located seven kilometres from the Reindeer field. This will then be followed by drilling the Pavo and Apus prospects in the Bedout Basin, located 35 to 40 kilometres from the Dorado field, and would be developed as subsea tiebacks to the Dorado development in a success case.

Consistent with Santos’ strategy to phase growth projects and review equity levels in-line with disciplined capital management, Santos is undertaking a process to explore interest from the market in non-operated equity in Dorado and potentially other WA oil assets.

Cooper Basin

1 Sales volumes include own product and third-party volumes.

Cooper Basin total production in the second quarter was 3.9 mmboe, lower than the previous quarter primarily due to higher unplanned surface downtime and lower drilling activity due to impact of COVID on joint venture budgets. Oil production reflects natural field decline with no new oil wells drilled in the first half consistent with the joint venture budgets.

Thirteen wells were drilled with three rigs in the second quarter, including six development wells, five appraisal wells and two exploration wells. A fourth rig was added to the program at the end of the quarter and will see a higher number of wells drilled in the second half compared to the first as the drilling program recovers from budget phasing caused by COVID during the first half.

The horizontal well programme continued in the second quarter with a positive result at Tarwonga 7 and preparation is well progressed for increased activity in the second half of the year with four horizontal gas wells and seven horizontal oil wells planned to be drilled.

Santos was awarded A$15 million in funding for the Moomba CCS project through the Australian Government’s CCUS Development Fund. Engagement with the Clean Energy Regulator and industry on the CCS methodology continued and the methodology has been released for public consultation. Eligibility for Australia Carbon Credit Units (ACCUs) for CCS is the key remaining milestone that would enable an FID decision on the project.

Work continued on the Moomba Zero Emissions Hydrogen project. Market development opportunities continue to be explored with domestic and international players to secure off-take arrangements.

Queensland & NSW

1 Combabula, Scotia (Santos legacy domestic volumes), Spring Gully and Denison.

2 Total sales volume, sales revenue and production include sales gas from NSW assets.

1 Includes APLNG equity share of Fairview, Arcadia and Roma East.

2 Includes LNG produced from GLNG equity gas, Santos portfolio gas and third-party quantities.

Gross GLNG-operated upstream sales gas production reached a record 700 TJ/day at the end of the second quarter. Upstream production continues to build and perform well. In the Arcadia field, production continues to ramp more quickly than anticipated, reaching 87 TJ/day with surface debottlenecking completed in both the field and plant. We continue to see safe and reliable production from the Scotia field producing 72 TJ/day, Roma field producing 195 TJ/day and Fairview field producing 345 TJ/day at the end of the quarter, in line with expectations.

LNG production was lower than the previous quarter due to a planned one-month statutory LNG train shut down in May. Based on current shipping plans, LNG production is expected to be above 6.2 mtpa for the full-year.

Fifty-two wells were drilled and sixty connected across the GLNG acreage in the second quarter.

Santos’ share of non-operated Eastern Queensland production was lower than the prior quarter due to planned facilities maintenance.

Following the Narrabri Gas Project EIS approval by the NSW Independent Planning Commission (IPC) and Federal approval under the EPBC Act, Santos has been progressing activities to address EIS and EPBC consent conditions to allow the commencement of the appraisal drilling program, which is required to inform the phased development at Narrabri. An appeal against the NSW IPC approval has been lodged with a hearing scheduled in August.

PNG

1 Includes SE Gobe

1 Measured at the Kutubu entry point.

2 Purchased by PNG LNG.

During the quarter, PNG LNG operated at an annualised rate of approximately 8.0 mtpa. Sales gas, condensate and LNG production were lower than the first quarter due to planned maintenance activities at Hides Gas Conditioning Plant and the LNG plant, which lasted for approximately five weeks.

Despite COVID-19 constraints, the maintenance activities were completed approximately one week ahead of schedule. COVID-19 management plans continue to be implemented to support stable production and shipping.

Northern Australia & Timor-Leste

Santos’ interest in Bayu-Undan and Darwin LNG reduced from 68.4 per cent to 43.4 per cent at the end of April following completion of the 25 per cent sell-down in both assets to Barossa partner SK E&S. As a result, production and sales volumes in the second half will be lower than the first half.

LNG production at Darwin LNG was lower than the prior quarter primarily due to a planned shutdown at Bayu-Undan and unplanned maintenance at Darwin LNG. Reservoir deliverability at Bayu-Undan continues in-line with expectations.

The Phase 3C infill drilling program at the Bayu-Undan field commenced in May with the first of three planned wells drilled to a total depth of 3,410 metres. The well encountered unswept reservoir section as per prognosis and was being completed at the end of the quarter in preparation for testing and tie-in to the production facility. Two further infill wells will be drilled in the coming months.

Following FID at the end of the first quarter, work on the US$3.6 billion Barossa gas and condensate project ramped-up across all workscopes. BW Offshore, the project’s FPSO contractor, let major contracts for the hull engineering and fabrication, for the topsides engineering and fabrication and for the turret mooring EPC. First steel for the FPSO turret was cut on 13 July. Plate manufacturing for the gas export pipeline has commenced and fabrication of subsea hardware and in-field flowlines is progressing. The project remains on track for first gas production in the first half of 2025.

Planning continues for the Darwin LNG life extension project and the tie-in of Barossa into Darwin. Santos and JERA continue to progress the sale and purchase agreement for JERA to acquire a 12.5 per cent interest in Barossa. Santos and Eni have signed an MOU to cooperate on opportunities in Northern Australia and Timor-Leste, including opportunities to re-purpose Bayu-Undan into a CCS hub for the region once existing production ceases.

In the onshore McArthur Basin (Beetaloo Sub-basin) in the Northern Territory, the Tanumbirini 2H horizontal well was spudded on 11 May targeting the B Shale interval of the Velkerri gas play. At the end of the quarter, the well was drilling ahead 8 ½” directional hole in Velkerri target formation. Following Tanumbirini 2H, Santos is planning to drill a second horizontal well, Tanumbirini 3H, targeting the Lower B Shale interval. Upon completion of drilling operations, multi-stage stimulation and flow testing of both wells is planned.

Corporate, exploration and eliminations

Sales volumes and revenues in the corporate segment primarily represent gas trading activities.

Capital expenditure

Total exploration, evaluation and development expenditure is summarised in the table below.

Capital expenditure in the second quarter comprised US$190 million in the base business (including $7 million for restoration costs) and US$144 million for major growth projects.

Oil price hedging

7.3 million barrels of oil hedging matured in the first half resulting in a net outflow before tax of US$66 million.

7.7 million barrels of oil equivalent are currently hedged for the remainder of 2021 using zero cost collars, with an average floor price of US$42 per barrel and an average ceiling price of US$55 per barrel.

For 2022, 6 million barrels of oil equivalent are currently hedged at an average floor price of US$50 per barrel and an average ceiling price of US$64 per barrel using a combination of zero cost collars and three-way option structures. For

2.0 million barrels, there is also the ability to re-participate at an oil price greater than US$65 per barrel due to their three-way option structure.

Seismic activity

In the Bedout Sub-basin, acquisition of the Archer 3D was completed at the end of May with high quality data acquired. The Keraudren Extension 3D, which followed directly after Archer, was 50 per cent complete at the end of the quarter.

Drilling summary

Near-field exploration (NFE) / Appraisal wells

*Spud in Q1, completed in Q2

Development wells