Australian energy company Santos said there's clearly more work left to do to adjust to the downturn in the energy sector. Photo by George Spade/Shutterstock
ADELAIDE, Australia, Aug. 19 (UPI) -- Acknowledging there's more work to do in the market downturn, Australian energy company Santos said it was moving forward with tight purse strings.
The third-largest oil and gas producer in Australia, Santos said losses for the first half of the year were $1.1 billion, against income of $30 million year-on-year.
Managing Director and CEO Kevin Gallagher took an upbeat look at the results, pointing to a second quarter that saw new production in terms of liquefied natural gas, a key product for the Asia-Pacific market.
"Our progress is also evidenced by record production and significant cost reductions achieved in the first half," he said in a statement. "But there is still a lot of work ahead of us."
Gallagher offered a similar statement in July during the release of the company's second-quarter results. Sales revenue for the second quarter of $590 million was 2 percent lower than the first quarter and 6 percent lower year-on-year.
The company last year reported heavy losses in net profits and capital expenditures, reflecting the substantial slump in crude oil prices.
Santos leads an $18.5 billion project designed to convert coal seam natural gas to liquefied natural gas for exports to the global market.
The company in July updated its guidance to show total production for 2016 would stay unchanged at between 57 million barrels of oil equivalent and 63 million barrels of oil equivalent. Spending, however, is tracking lower, with its revised guidance showing a 30 percent decline to $750 million.
The company is in the midst of a corporate shake up with transition "well under way" by the end of the second quarter.
"The appointment of the new executive team was a key step in establishing [a] new operating model," Gallagher said.