Santos Ltd (STO) 2009年年度報告「ASX」.pdf

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1、Were not just an energy company.Were a company with energy.ANNUAL REPORT 2009ABOUT SANTOSAn Australian energy pioneer since 1954,Santos is one of the country s leading gas producers,supplying Australian and Asian customers.Santos has been providing Australia with natural gas from the remote outback

2、for more than 40 years.The company today is the largest producer of natural gas to the Australian domestic market,supplying 18%of the nation s gas needs.Santos has also developed major oil and liquids businesses in Australia and operates in all mainland Australian states and the Northern Territory.F

3、rom this base,Santos is pursuing a transformational liquefi ed natural gas(LNG)strategy with interests in four exciting LNG projects.This strategy is led by the cornerstone GLNG project in Queensland a leading project in converting coal seam gas into LNG.Also in Santos LNG portfolio are the PNG LNG

4、project,which was formally approved in December 2009,Bonaparte LNG,a proposed fl oating LNG project in the Timor Sea,and Darwin LNG,Santos fi rst LNG venture,which began production in 2006.Santos has built a strong and reliable production business in Indonesia and is further developing its Asian bus

5、iness through development projects and exploration investment.In 2009,Santos total production was 54.4 million barrels of oil equivalent.We have the largest Australian exploration portfolio by area of any company 133,800 square kilometres.Santos has about 2,200 employees working across its operation

6、s in Australia and Asia.VISION AND STRATEGYSantos vision is to be a leading energy company for Australia and Asia by delivering the base business,tapping our resource riches,being a great place to work and doing it safely and sustainably to deliver a superior shareholder return.Santos has a robust s

7、trategy to achieve this through:Reliable base business:Eastern Australia:margin growth and resource conversion Indonesia:established business with incremental growth Western Australia:growing a material domestic gas businessTransformational LNG:GLNG:a leading CSG-to-LNG project underpinned by qualit

8、y reserves PNG LNG:approved in 2009 with fi rst production in 2014 Darwin LNG:LNG production since 2006,mature brownfi eld growth Bonaparte LNG:innovative proposed fl oating LNG projectFocused growth in Asia:Vietnam:develop Chim So and exploration-led growth India/Bangladesh:Bay of Bengal exploratio

9、n-led growth Kyrgyz Republic:exploration prospects in proven oil and gas provincesVALUESWe are a team that:Discovers by opening our minds to new possibilities,thinking creatively and having the courage to learn from successes and failures,to take on new challenges,to capture opportunities and to res

10、olve problems.Delivers by taking personal responsibility and pride in our work to deliver timely,quality results that benefi t Santos and help achieve our vision and strategy.Collaborates by recognising the value and power in diversity of thought and communicating openly to understand the perspectiv

11、es of others;demonstrating leadership by sharing what we know and respectfully challenging each other to achieve the best results for all.Cares by taking the long-term view to build a sustainable future for our company,our people and the environments and communities in which we operate.2 2009 OPERAT

12、ING AND FINANCIAL HIGHLIGHTS Key results for 2009 and fi ve-year performance.3 CONTINUING TO PROGRESS OUR GROWTH STRATEGY IN 2009 4 THE ENERGY TO TRANSFORMChairman Peter Coates comments on Santos performance in 2009.6 THE ENERGY TO DELIVERChief Executive Offi cer David Knox reviews a year which mark

13、ed a signifi cant chapter in the ongoing transformation of Santos.8 STRONG BALANCE SHEET TO FUND GROWTH Chief Financial Offi cer Peter Wasow puts the numbers in perspective and explains the 2009 fi nancial results.10 THE WORLD OF SANTOS Locations of Santos exploration,development and production acti

14、vities.12 PRODUCTION STATISTICS 2009 Summary of production results for 2009.13 RESERVES STATISTICS 2009 Summary of reserves movements in 2009.14 LNG PROJECTS Santos transformational GLNG project,progress on PNG LNG,Bonaparte LNG and Darwin LNG.16 AUSTRALIA Growth in the Cooper Basin,New South Wales

15、coal seam gas exploration and Reindeer gas project go-ahead.18 ASIASolid progress in Indonesia,Vietnam drilling success and seismic surveys offshore India.20 SUSTAINABILITYSustainability policies,systems and activities,including safety and environmental performance,employees and communities.22 BOARD

16、 OF DIRECTORS24 SANTOS LEADERSHIP TEAM26 CORPORATE GOVERNANCE38 SANTOS GROUP INTERESTS40 10-YEAR SUMMARY 43 DIRECTORS STATUTORY REPORT52 REMUNERATION REPORT70 FINANCIAL REPORT 151 SECURITIES EXCHANGE AND SHAREHOLDER INFORMATION153 GLOSSARY154 INDEX155 INFORMATION FOR SHAREHOLDERS156 MAJOR ANNOUNCEME

17、NTS MADE BY SANTOS DURING 2009 Cover:Operator maintainer Bill Loof at Fairview in Santos eastern Queensland fi elds.This page:Drilling and completions rig,Arcadia Valley coal seam gas fi elds,eastern Queensland.Were a company with energy The energy to explore the remotest and harshest terrain The en

18、ergy to unlock vast resources in places where many said nothing would be found The energy to spearhead innovations like CSG to LNG conversion The clean energy to fuel homes and industry throughout Australia and Asia as well as power nations now and into the future The energy to take bold initiatives

19、 to grow our own business.In short,we have the energy to make things happen.Santos Annual Report 200922009 operating and fi nancial highlights SALES REVENUE$2,181 MILLION,DOWN 21%;PRODUCTION 54.4 MMBOE,WITHIN GUIDANCE.NET PROFIT AFTER TAX$434 MILLION.UNDERLYING NET PROFIT AFTER TAX$257 MILLION,COMPA

20、RED TO$548 MILLION IN 2008.2009 FULL YEAR DIVIDEND OF 42 CENTS PER SHARE,UNCHANGED FROM 2008.PROVEN AND PROBABLE(2P)RESERVES INCREASED 42%TO 1.44 BILLION BARRELS.STRONG BALANCE SHEET:$2.2 BILLION OF CASH.20092008%changeSales($million)2,181.0 2,762.0(21)Operating profi t before tax($million)717.0 2,5

21、33.0(72)Cash fl ow from operations($million)1,155.0 1,385.0(17)Earnings per share(cents)52.1 251.9(79)Ordinary dividends per share(cents)42.0 42.0 0Cash fl ow per share(cents)148.2 216.5(32)Total shareholders funds($million)6,967.0 4,478.0 56Return on average ordinary equity(%)7.5 50.6(85)Return on

22、average capital employed(%)7.3 34.1(79)Net debt/(net debt plus equity)(%)(9.5)10.2(193)Net interest cover(times)(45.4)38.5(218)0204060PRODUCTION BY PRODUCT54.4 mmboe 20062005200720082009LNGLPGCondensateCrude oilSales gasðane61.056.054.454.459.103006009001,2001,500NET PROFIT AFTER TAX$434 million2

23、00620052007200820096437624341,65035903006009001,2001,500OPERATING CASH FLOW$1,155 million 200620052007200820091,5501,4581,1551,2141,38502468SAFETY PERFORMANCE3.6200620052007200820096.44.93.65.85.3Total recordable case frequency rate(per millions hours worked)LNGLPGCondensateCrude oilSales gasðane

24、05001,0001,5002,0002,5003,000SALES REVENUE$2,181 million 200620052007200820092,4632,1812,4892,7622,750050100150200250EARNINGS&DIVIDENDS PER SHARE42 cents 20062005200720082009Dividends per shareEarnings per share3611540955142524225240Continuing to progress our growth strategy in 2009LNG projectsPage

25、15 GLNG signs gas sales agreement with project partner PETRONAS for up to three million tonnes per annum of LNG;submits Environmental Impact Statement to Queensland Government.PNG LNG project formally approved.Bonaparte LNG:proposed fl oating LNG processing facility in the Timor Sea.AustraliaPage 17

26、 Santos celebrates 40 years of natural gas delivery from Moomba processing plant in the Cooper Basin.The basin retains signifi cant development potential.Newly sanctioned projects offshore Victoria;Reindeer project offshore Western Australia well underway.Acquisition of signifi cant new acreage in G

27、unnedah Basin,NSW.AsiaPage 19 Indonesia fi rmly established in Santos base business.Continues incremental growth in producing assets.Oyong Phase-2 project in Indonesia online.Delivered safely and ramped up to production within 20 days.Chim So,Santos fi rst oil project in Vietnam,formally approved.Op

28、erator maintainer Mark Bunker and operations superintendent Belinda Wells near Scotia in Santos eastern Queensland coal seam gas fi elds.Santos Annual Report 20094Review by Peter Coates,ChairmanThe energy to transformSantos Annual Report 20095Santos made great progress in delivering its growth strat

29、egy in 2009 and is well equipped to meet the signifi cant challenges ahead.It has a clear set of strategic priorities,an exciting pipeline of growth projects,a sound balance sheet,high quality partners and a talented executive team led by its Chief Executive Offi cer,David Knox who,since becoming CE

30、O in 2008,has led a transformation of the company s perception by the investment market and its shareholders.While our underlying fi nancial performance was down on 2008 due to lower oil prices,our base business performed well with consistent production,an improved cost performance and excellent pro

31、ject delivery.STRATEGIC PROGRESS IN 2009Our strategy is underpinned by the twin pillars of growing demand for primary energy in Australia and Asia,and the role that natural gas can play as a cleaner fuel in meeting that demand.Some of the signifi cant strategic milestones achieved during 2009 were:I

32、n December,we sanctioned the Papua New Guinea LNG project.PNG LNG will provide Santos with long-term production and cash fl ow when it comes online in 2014 and create a legacy asset for decades to come.Our Gladstone Liquifi ed Natural Gas(GLNG)project took major steps forward as it moves towards a f

33、i nal investment decision.In June,GLNG signed a binding offtake agreement to sell two million tonnes per annum of LNG to project partner PETRONAS,with an option for a further one million tonnes per annum at GLNG s sole option.This agreement underpins the fi rst LNG train,or processing unit,of two pl

34、anned for the initial phase of the project.We focused the business,selling a number of non-core assets and growing our strategic position in the Gunnedah Basin,Australia s next major coal seam gas(CSG)province.SOLID FINANCIAL PERFORMANCESantos recorded a net profi t of$434 million in 2009.This compa

35、res with the$1.7 billion result reported for 2008 which was boosted by a$1.2 billion profi t from the sale of a 40%interest in the GLNG project to PETRONAS.Underlying net profi t in 2009 of$257 million compares with$548 million in the prior year.Lower product prices reduced sales revenue by nearly$6

36、00 million compared with 2008.Production from the base business of 54.4 million barrels of oil equivalent was the same as the previous year and within the company s guidance range.Importantly,cost reduction initiatives in the base business delivered early benefi ts.In November,Santos celebrated the

37、40th anniversary of the fi rst delivery of natural gas from the Moomba processing plant in the Cooper Basin.The Cooper Basin has underpinned the growth of Santos for four decades and will continue to play a very important role in providing primary energy for eastern Australia.SUCCESSFUL EQUITY RAISI

38、NGSantos issued new equity in 2009 to raise approximately$3 billion to fund PNG LNG,future growth and redeem the FUELS hybrid security.The equity raising was very successful with strong support from institutional and retail shareholders.On behalf of the Board,I would like to thank shareholders for t

39、heir support.DIVIDEND MAINTAINEDAt a time when many companies were cutting or eliminating their dividends,the Board maintained the Santos dividend at 42 cents per share fully franked,the same as the previous year.This dividend was paid on the expanded capital base following the equity raising.BOARD

40、RENEWALThe ongoing process of Board renewal has continued,with the retirement of two longstanding directors and two new appointments.Jane Hemstritch and Greg Martin have joined the Board and are already making signifi cant contributions.Judith Sloan retired from the Board following the Annual Genera

41、l Meeting in May after serving shareholders and the company with distinction over her 14 years as a director.Stephen Gerlach retired from the Board in December after 20 years of service as a Director and the last eight years as Chairman.Stephen oversaw the transformation of Santos from a Cooper Basi

42、n focused domestic business to one with a clear vision of becoming a major energy supplier to Australia and Asia.On behalf of the Board and all shareholders,I thank Stephen for his 20 years of service to the company.I am delighted to assume the Chairmanship at this critical point in the company s hi

43、story,when it is on the cusp of major transformation from a domestic focused natural gas producer into a leading energy company for Australia and Asia.On behalf of the Directors,I would like to thank David and the team at Santos for their hard work and dedication to delivering value for shareholders

44、.Peter Coates AOChairmanReview by David Knox,Chief Executive Offi cer and Managing DirectorThe energy to deliverSantos Annual Report 20097Santos vision is to be a leading energy company in Australia and Asia.We have a simple and robust strategy to achieve this:we will drive performance in our base b

45、usiness,deliver a suite of LNG projects and pursue focused opportunities in Asia.In 2009,we demonstrated our determination to deliver the vision,making signifi cant progress on all our strategic fronts.MEETING AN ENERGY CHALLENGEAustralasia faces the challenge of achieving energy security for its gr

46、owing economies in a carbon-constrained world.Natural gas as a fuel for electricity generation has the potential to underwrite signifi cant cuts in greenhouse gas emissions while meeting energy needs.Importantly,natural gas is abundant,affordable and available now.We are Australia s largest producer

47、 of gas for domestic consumption,and 95%of our proved and probable reserves are gas or associated gas liquids.There is suffi cient natural gas in eastern Australia to meet domestic needs and,at the same time,build a new LNG export industry on the east coast.Australia and Santos in particular is pois

48、ed to capture a signifi cant market opportunity in LNG,demand for which is expected to double in Asia in the next 15 years.LNG GROWTH STRATEGYSantos LNG growth portfolio is unique for a company of our size.We have made substantial progress on our fl agship GLNG project and we are moving towards a fi

49、 nal investment decision in the middle of 2010.GLNG has all the ingredients for success:an ideal site,high quality reserves,a binding sales contract and the experience and expertise of our partner PETRONAS,the largest LNG supplier in Asia.Elsewhere,the PNG LNG project was approved for development at

50、 the end of 2009.The project has signed binding long-term LNG sales agreements with four Asian buyers and fi rst sales are expected in 2014.The existing Darwin LNG project our fi rst LNG investment delivered another excellent year of production.Finally,in 2009 we added our fourth LNG project,Bonapar

51、te LNG,in partnership with GDF SUEZ.This project exposes Santos to fl oating LNG technology and GDF SUEZ is targeting 2013 for the fi nal investment decision.BASE BUSINESS PROGRESSOur growth strategy is not all about LNG.We have a pipeline of base business projects that will grow production in the n

52、ear term before our LNG ventures deliver a step change in production and earnings from 2014.In 2009,progress on the base projects was excellent,with two reaching initial production,three progressing to schedule and the approval of a sixth,the Chim So oil project in Vietnam.Our Oyong gas project in I

53、ndonesia delivered fi rst gas in October 2009 on schedule,on budget and with an excellent safety record.In Vietnam,the Chim So oil project was approved our fi rst in that country.In Australia,we completed the upgrade of the Patricia-Baleen plant in Victoria to process gas from the offshore Longtom f

54、i eld.The Kipper and Henry gas projects in Victoria and the Reindeer project in Western Australia progressed well,with fi rst gas from Henry achieved on schedule in early 2010.SAFETY PERFORMANCETragically,in August,a contractor was killed during a drilling rig move in our eastern Queensland fi elds.

55、It was a sobering reminder of the need to always be conscious of risks in everything we do.Overall in 2009,we achieved the lowest injury rate in the company s history,which is pleasing.This result was built on strong safety systems and a series of initiatives that were implemented to improve our foc

56、us on safety.SUSTAINABILITYSantos has reduced its carbon footprint by 1.5 million tonnes of carbon dioxide equivalent over the past fi ve years.I encourage you to read our Sustainability Report 2009 and fi nd out more about what sustainability means to Santos and what we are doing to achieve it.It i

57、s important that we make meaningful contributions to the communities in which we operate.In 2009,we continued to support many community,education,arts,environment and indigenous organisations and initiatives throughout Australia,plus community programs in Indonesia and Vietnam.Our partnership with t

58、he Santos Tour Down Under was the headline act of our community sponsorship program.The event attracted worldwide attention and was watched by 750,000 spectators over its six days.LOOKING TO THE FUTURELooking forward,our excellent portfolio of current and future projects positions us well to achieve

59、 our growth strategies.Our focus remains on executing our transformational LNG growth projects and delivering production from our base businesses in Australia and Asia.We are committed to doing all that safely and sustainably to deliver maximum value for our shareholders.David KnoxChief Executive Of

60、fi cerand Managing DirectorSantos Annual Report 20098In 2009,the company continued to deliver on its strategy:improving performance from the base business;commercialising contingent resources and growing reserves;and building a strong fi nancial position to fund its future growth.Much of this growth

61、 will result from realising our LNG ambitions,progress against which was detailed in the CEO s Review.BUILDING A BETTER BASE BUSINESSDespite our efforts,we were not immune from the effects of the economic downturn which resulted in lower selling prices across our portfolio and reduced profi ts compa

62、red to last year.Santos achieved a net profi t of$434 million after tax in 2009.This compares to the$1.7 billion result reported for 2008,which was boosted by a$1.2 billion profi t from the sale of a 40%interest in the GLNG project to PETRONAS.Underlying net profi t in 2009 of$257 million compares t

63、o$548 million in the prior year.Lower oil and gas prices signifi cantly impacted the 2009 result,reducing sales revenue by almost$600 million compared to the previous year.Production of 54.4 million barrels of oil equivalent(mmboe)was the same as the previous year and in the middle of the company s

64、guidance range.Sales volumes were up by 8%to 60.1 mmboe.Strong gas production in Western Australia and Indonesia,combined with new production from Oyong Phase-2 in Indonesia,offset natural fi eld decline in mature assets.The company undertook a major cost reduction program at the start of the year a

65、nd achieved improved performance in both cost of sales and cost of production.Pleasingly,we had a very good result on our major expense item,depreciation and depletion,where costs reduced by almost$50 million compared to last year.Operating cash fl ow of$1,155 million was 17%lower,primarily due to p

66、roduct prices,but was offset by lower cash costs and income taxes paid.We expect 2010 production to be between 51 and 54 mmboe.Production growth will resume in 2011 as the company s pipeline of new projects,including Reindeer,Kipper and Chim So,come on stream.RESERVES GROWTH AND RESOURCE CONVERSIONR

67、eserves growth and resource conversion have been key features of our strategy.Our track record of commercialising contingent resources was again a feature in 2009.In total we commercialised more than 750 mmboe by either converting these resources to reserves or divesting them for cash.Santos increas

68、ed its proved and probable(2P)reserves by 427 mmboe,taking the company s total 2P reserves to a record 1,440 mmboe.2P reserve life,on 2009 production rates,has increased to over 26 years:around twice the reserve life of fi ve years ago.Review by Peter Wasow,Chief Financial Offi cer and Executive Vic

69、e President Strong balance sheet to fund growth03006009001,2001,5002P RESERVES mmboe200520062007200820097748198791,0131,440Five-year compound growth rate=18%Santos Annual Report 20099SANTOS VS ASX 200 INDEX FIVE-YEAR RELATIVE PERFORMANCE$Santos(STO)20052006200720082009Mutineer-Exeteroil start-upTipp

70、eraryacquisitionDarwin LNGstart-upMaleo gasstart-upOyong oilstart-upPNG LNG gas agreementand FEED entryGLNG FEEDcontractor appointedGLNG signs bindingHeads of Agreementfor sale of 2 mtpa of LNGPNG LNGsanctionedJohn Brookesgas start-upCasino gasstart-upGLNGannouncedParliamentary approvalto remove 15%

71、share capPETRONAS appointedGLNG partnerEquity raisingannouncedGDF SUEZ strategicpartnership announced0510152025ASX 200The quality of the reserve base is also improving.We now have almost half of our reserves targeted at the higher margin LNG business,and about a third of those are conventional reser

72、ves at PNG LNG and Darwin LNG.STRONG BALANCE SHEETDespite the uncertainty in fi nancial markets which marked most of 2009,we were able to successfully raise more than$5 billion in new capital.This has put us in a very strong position to continue to advance our strategy.Santos successfully issued new

73、 equity in 2009 to raise approximately$3 billion to fund PNG LNG,future growth and redeem the FUELS hybrid security.Cash and term deposits at the end of the year totalled more than$2.2 billion.Santos has committed but undrawn corporate debt facilities of$700 million.In addition,the company has commi

74、tted debt facilities of$2.1 billion to fund the PNG LNG project.Total funding capacity therefore stood at$5 billion at year end.As part of actively managing our portfolio of assets,Santos generated over$300 million in proceeds from asset sales during 2009.A total of US$200 million was realised throu

75、gh the sale of 60%of the Petrel,Tern and Frigate fi elds to GDF SUEZ as part of the Bonaparte LNG transaction.Santos also sold its interests in Petroleum Retention Licence 5 in Papua New Guinea,the Kakap Joint Venture in Indonesia,oil and gas assets in Egypt and the Churchie oil and gas assets in Qu

76、eensland.Santos also announced the acquisition of signifi cant additional CSG acreage in the Gunnedah Basin in northern New South Wales and investment in leading local CSG company Eastern Star Gas Limited for$476 million.The acquisition combines the proven CSG experience of Santos and Eastern Star w

77、ith the ability of Santos to deliver major projects and develop various channels to market.Santos maintained its fully franked dividend at 42 cents per share in 2009.10Santos Annual Report 2009131815171614101211202119654793281The world of SantosNam Con Son BasinPhu Khanh BasinBeibuan TroughKutei Bas

78、inBrowse BasinOtway BasinPort BonythonCooper/Eromanga BasinsAmadeus BasinCarnarvon BasinTimorDarwinBonaparte BasinGunnedah BasinGippsland BasinEast Java BasinSurat/Bowen BasinsPapua New GuineaBengal BasinNorth East Coast BasinFergana Basin10PerthJakartaHanoiNew DelhiPort MoresbyBishkekDhakaAdelaideG

79、ladstoneRomaBrisbaneGunnedahOPERATEDNON-OPERATEDExplorationDevelopmentOperations/ProductionSantos offi cesSantos Annual Report 200911REF LOCATIONSITE/ASSETACTIVITYDESCRIPTION1Fergana Basin,Kyrgyz RepublicNon-operated exploration in six prospecting licences.2North East Coast Basin,offshore IndiaOpera

80、ted interests in two exploration permits.3Bengal Basin,offshore BangladeshSanguNon-operated interests in one exploration permit and gas and condensate production from Sangu development area.4Beibuan Trough,offshore VietnamOperated interest in one exploration permit.5Phu Khanh Basin,offshore VietnamO

81、perated interest in one exploration permit.6Nam Con Son Basin,offshore VietnamChim So,DuaNon-operated interest in one exploration permit,which contains Chim So oil(in development)and Dua oil and gas discoveries.7Kutei Basin,offshore IndonesiaNon-operated interest in Popodi and Papalang PSCs.8East Ja

82、va Basin,offshore IndonesiaMaleo,Oyong,WortelOperated interest in Sampang PSC,which contains Oyong oil and gas production,and the Wortel gas discovery(for which development planning is currently in progress).Operated interest in Madura Offshore PSC,which contains Maleo gas production.9Papua New Guin

83、eaPNG LNG,Hides,Barikewa,SE Gobe Non-operated interests in the PNG LNG project and the Hides fi eld and oil production from SE Gobe.Operated interests in the undeveloped Barikewa gas resources.10Timor Sea and Timor GapBayu-Undan,Darwin LNG,Jabiru-ChallisNon-operated interests in four production lice

84、nces,which contain gas,condensate and LPG production from Bayu-Undan,LNG production from Darwin LNG,and oil production from Jabiru-Challis.11Bonaparte Basin,offshore northern AustraliaBarossa,Caldita,Evans Shoal,Petrel-Tern-FrigateOperated interest in three retention licences and one exploration per

85、mit in the southern Bonaparte,which contains the Petrel-Tern-Frigate gas fi elds under development in a joint venture with GDF SUEZ(Bonaparte LNG).Operated interest in one exploration permit in the northern Bonaparte,which contains the undeveloped Evans Shoal gas resource,and non-operated interests

86、in two exploration permits containing the undeveloped Barossa and Caldita gas resources.12Darwin,Northern TerritoryWickham PointNon-operated Darwin LNG facility.13Browse Basin,offshore Western AustraliaBurnsideOperated interests in four exploration permits,including the Burnside discovery.14Carnarvo

87、n Basin,offshore Western AustraliaMutineer-Exeter,John Brookes,Barrow Island,Legendre,Reindeer,Stag,ThevenardOperated interests in three production licences which include oil production from Mutineer-Exeter,ten exploration permits and one retention licence.Non-operated interests in numerous explorat

88、ion permits and production licences,which contain oil production from Barrow Island,Legendre,Stag and Thevenard,and gas and condensate production from John Brookes,and the Reindeer gas development.15Amadeus Basin,Northern TerritoryMereenie,Palm Valley,Dingo Brewer EstateOperated interests in two pro

89、duction licences,which contain oil,gas and condensate production from Mereenie.Non-operated interest in one production licence,which contains gas production from Palm Valley.Operated interest in one retention licence containing the Dingo fi eld,also contains Brewer Estate liquids facility.16Cooper/E

90、romanga Basins,South Australia and QueenslandMoomba,Ballera,JacksonOperated and non-operated interests in numerous exploration and production permits across South Australia and Queensland,which contain oil,gas,condensate and LPG.Main production centres are located at Moomba,Ballera and Jackson,plus

91、satellite facilities and associated infrastructure.17Spencer Gulf,South AustraliaPort BonythonOperated processing and load-out facility.18Surat/Bowen Basins,QueenslandDenison,Fairview,Spring Gully,Scotia,Roma,Moonie,WallumbillaOperated and non-operated interests in numerous exploration and productio

92、n permits,which contain coal seam gas production from Fairview,Scotia,Spring Gully and Roma,conventional gas production from Denison and Roma and oil production from Moonie.Wallumbilla contains an LPG extraction plant and export compression facilities.Drilling of coal seam gas fi elds underway for G

93、LNG.19Gunnedah Basin,New South WalesOperated interests in six exploration permits.Non-operated interests in three exploration permits,one assessment lease which is to appraise coal seam gas and one production permit which contains conventional gas production.20Gippsland Basin,offshore VictoriaPatric

94、ia-Baleen,Kipper,SoleOperated interests in three permits,which contain Patricia-Baleen gas fi eld and processing plant and the Sole gas resource.Non-operated interest in one permit,which contains the Kipper gas development project.21Otway Basin,offshore VictoriaCasino,Henry,MinervaOperated interests

95、 in three permits,which contain gas and condensate production from Casino and Henry/Netherby developments.Operated exploration interests in one permit.Non-operated interest in one permit which contains gas and condensate production from Minerva.11Detailed exploration maps are available on the Santos

96、 website .Percentage interests are provided in the Santos Group interests section of Santos Annual Report 2009.Santos Annual Report 200912Production statistics 2009Total 2009Total 2008Field UnitsmmboeField UnitsmmboeSales gas,ethane and LNG(PJ)Cooper79.913.790.215.5Surat/Bowen/Denison31.95.532.85.6A

97、madeus10.61.812.22.1Otway/Gippsland20.53.521.03.6Carnarvon43.57.527.34.7Bonaparte16.32.816.32.8Indonesia30.25.224.24.2Bangladesh5.71.06.31.1Total production238.641.0230.339.6Total sales volume268.246.1237.940.9Total sales revenue($million)1,098.21,051.6Crude oil(000 bbls)Cooper3,598.43.63,945.74.0Su

98、rat/Denison62.50.171.10.1Amadeus106.30.1127.90.1Legendre288.70.3299.60.3Thevenard305.70.3339.80.3Barrow573.50.66170.6Stag1,643.91.61,627.91.6Mutineer-Exeter995.01.01,254.61.3Jabiru-Challis105.90.1142.00.1Indonesia560.30.6983.41.0SE Gobe148.10.1188.20.2Total production8,388.38.49,597.29.6Total sales

99、volume8,604.58.69,796.89.8Total sales revenue($million)678.31,150.6Total 2009Total 2008Field UnitsmmboeField UnitsmmboeCondensate(000 bbls)Cooper1,095.21.01,295.11.2Surat/Denison7.60.017.40.0Amadeus46.60.167.40.1Otway23.40.022.10.0Carnarvon435.50.4291.40.3Bonaparte1,552.61.51,594.71.5Bangladesh0.90.

100、01.20.0Total production3,161.83.03,289.33.1Total sales volume3,505.83.33,173.93.0Total sales revenue($million)233.2321.2LPG(000 t)Cooper151.21.3162.01.4Surat/Denison0.30.01.30.0Bonaparte88.60.788.10.7Total production240.12.0251.42.1Total sales volume252.62.1250.52.1Total sales revenue($million)170.8

101、238.4TotalProduction(mmboe)54.454.4Sales volume(mmboe)60.155.8Sales revenue($million)2,180.52,761.8Santos Annual Report 200913Proven plus probable reserves(Santos share)by activitySales gas(incl.ethane&LNG)PJCrude oilmmbblCondensatemmbblLPG 000 tonnesTotalmmboeReserves year end 20085,03983422,9891,0

102、13Production(239)(8)(3)(240)(54)Additions2,857232109525Acquisitions/divestments(197)(3)(7)(10)(44)Estimated reserves year end 20097,46074642,8481,440Proven plus probable reserves(Santos share)year end 2009 by areaAreaSales gas(incl.ethane&LNG)PJCrude oilmmbblCondensatemmbblLPG 000 tonnesTotalmmboeEa

103、stern AustraliaCooper Basin76231111,607186Southern Australia4650539888Qld CSG3,024000520Qld conventional5600010NSW CSG53200091Total EA4,83931162,005895Western Australia and Northern TerritoryCarnarvon7422450155Bonaparte27801784371Amadeus9551023Total WA and NT1,1152923843249Asia Pacifi cPNG1,13012502

104、18Indonesia16810030Vietnam9120014Bangladesh70001Total AP1,31414250263Total 7,26874642,8481,407Benefi cial interests*19200033Grand total7,46074642,8481,440*STO owns 19.42%of Eastern Star Gas,which has a 65%interest of PPL3,PAL2,PEL238,PEL433 and PEL434Reserves(Santos share)(mmboe)Year end 2008Product

105、ionAdditionsAcq/DivYear end 20091P reserves51854230(46)6472P reserves1,01354525(44)1,4402C contingent resources2,8490(260)(92)2,497The information in this reserves statement has been compiled by Greg Horton,a full-time employee of the company.Greg Horton is qualifi ed in accordance with ASX Listing

106、Rule 5.11 and has consented to the form and context in which this statement appears.Approximately 70%of Santos year-end 2009 2P Reserves and 37%of 2C contingent resources(including 100%of CSG 2P Reserves and 99%of CSG 2C contingent resources),were audited by independent experts Gaffney,Cline&Associa

107、tes(conventional assets)and Netherland,Sewell&Associates,Inc.(CSG assets).Additionally,over the last two years,GCA,NSAI and DeGolyer and MacNaughton have audited approximately 94%of Santos combined total year-end 2009 2P plus 2C estimates.The auditors found that based on the outcomes of each of the

108、respective audits and their understanding of the estimation processes employed by Santos,that Santos December 31,2009 Reserves and Contingent Resources quantities in aggregate compare reasonably to those estimates prepared by the auditors.Gaffney,Cline&Associates found that,in the aggregate,the tota

109、l volumes summarised in the Santos summary table represents a reasonable estimate of Santos December 31,2009 Reserves and Contingent Resources position.Reserves statistics 2009Senior completions engineer Gabriel Amorer in Santos coal seam gas fi elds in the Arcadia Valley,eastern Queensland.Santos A

110、nnual Report 200915LNG projects GLNG operations adviser Glen Anyon at Santos Chinchilla white gum plantation near Fairview,eastern Queensland.BENEFICIAL USE OF CSG WATERSantos has developed an innovative solution to a challenge faced by the global CSG industry effectively using water produced during

111、 CSG extraction.The water will be used to nurture a plantation of two million native Chinchilla white gum trees near Fairview in eastern Queensland.Almost one million trees have been planted,and plans are being discussed to extend the plantation to six million trees.Santos will also use the water to

112、 irrigate feedstock for cattle,boosting beef production in the area.Unprecedented economic growth in Asia is increasing demand in the region for LNG demand that Santos transformational LNG strategy is poised to support.LNG demand in the Asia-Pacifi c is expected to double in the next 15 years.This f

113、orecast increase substantially outstrips contracted supplies.Santos has abundant resources in close proximity to these markets and a track record of reliable delivery.Santos has an LNG portfolio unique for a company of its size:its cornerstone GLNG project,the recently approved PNG LNG project,the e

114、xisting Darwin LNG project,and the proposed Bonaparte LNG project.GLNG:SIGNIFICANT ACHIEVEMENTSThe GLNG project will involve piping CSG from Santos eastern Queensland fi elds to a plant at Gladstone,where the gas will be liquefi ed and loaded to ships for sale to world markets.GLNG reached an import

115、ant milestone in June 2009 when it announced a binding heads of agreement to sell two million tonnes per annum(mtpa)of LNG to Santos GLNG project partner PETRONAS over 20 years,starting in 2014.As part of the deal,PETRONAS has also undertaken to buy an additional one mtpa of LNG should GLNG elect to

116、 supply.The commercial terms and price of the agreement are in line with industry practice for long-term contracts.The gas will be used in the Malaysian domestic market.PETRONAS,the world s third-largest LNG producer and the largest LNG producer in Asia,bought a 40%stake in GLNG in 2008.Proven and p

117、robable CSG reserves have grown three-fold since 2007,and Santos now has more than enough gas to underpin the fi rst GLNG train.Front-end engineering and design studies are nearing completion.The GLNG Environmental Impact Statement(EIS)was submitted to the Queensland Government in March 2009.The EIS

118、 examined the potential environmental,social and economic impacts of the project.After a period of public review,a supplementary EIS was submitted to the Queensland Government in November 2009.GLNG s cultural heritage management plans are well advanced,with fi ve of seven Indigenous Land Use Agreeme

119、nts already established.These agreements provide benefi ts to Aboriginal groups in the form of compensation,and employment and training initiatives.A fi nal investment decision is expected around the middle of this year and fi rst LNG shipments are scheduled for 2014.PNG LNG PROJECT APPROVEDCo-ventu

120、rers in the PNG LNG project gathered in Port Moresby in December 2009 to formally give the go-ahead for the project.PNG LNG will involve piping gas from the Hides gas fi eld in the PNG highlands to a proposed 6.6 mtpa LNG plant near Port Moresby.It is the largest ever investment in PNG and is expect

121、ed to double the country s gross domestic product.Santos has a 13.5%stake in the ExxonMobil-led project and a US$2 billion share of the estimated capital cost.First gas sales are targeted for 2014.Offtake agreements have been signed for all expected production,and will supply to Sinopec,TEPCO,Osaka

122、Gas and CPC Taiwan.PROPOSED FLOATING LNGSantos has partnered with France s GDF SUEZ,one of the world s leading LNG companies,to develop the Bonaparte LNG project in the Timor Sea.Bonaparte LNG proposes to use cutting-edge technology to develop a fl oating LNG processing plant.As part of the partners

123、hip,GDF SUEZ has bought 60%of the Petrel,Tern and Frigate gas fi elds from Santos for up to US$370 million,and will carry all Santos share of the costs until a fi nal investment decision,expected in 2013.DARWIN LNG CONTINUES SOLID PRODUCTIONThe Darwin LNG project,Santos fi rst producing LNG asset,co

124、ntinued to produce well in 2009.Santos has an 11.4%stake in Darwin LNG,which commenced production in 2006.The successful project takes gas from the offshore Bayu-Undan fi elds 500 kilometres north-west of Darwin in the Timor Gap.Darwin LNG capacity will be increased during statutory shutdown work pl

125、anned for the fi rst half of 2010.Steel pipeline being spooled onto pipelay vessel at Crib Point on Victorias Mornington Peninsula.The pipe was welded together on land and spooled onto the vessel,before being unreeled offshore to connect the Netherby and Henry wells to existing Casino infrastructure

126、.Santos Annual Report 200917AustraliaThe fi rst major discovery of natural gas in the Cooper Basin occurred at the Gidgealpa-2 well on New Years Eve,1963.40 YEARS OF NATURAL GASOn 10 November 2009,Santos commemorated the 40th anniversary of natural gas delivery from its Moomba processing plant in th

127、e Cooper Basin.The company held a series of events in Adelaide and throughout the Cooper Basin to celebrate the event.The fi rst molecules of natural gas arrived in Adelaide via the 755-kilometre pipeline from Moomba.Santos and its joint venture partners have since delivered 5.8 trillion cubic feet

128、of gas to customers throughout the eastern Australian states and territories.South Australia uses this abundant and local natural gas supply for a high proportion of its electricity generation(56%),and subsequently has the cleanest power supply of all Australian mainland states.Santos is Australia s

129、 largest domestic gas producer.The company s Australian base business comprises gas and oil production assets in all mainland states and the Northern Territory.Continued solid production combined with sanctioned projects and the potential of untapped reserves fi rmly places Santos in a position to s

130、erve the growing demand for natural gas and help Australia move towards a cleaner energy future.NATURAL GAS:THE KEY TO A CLEANER ENERGY PORTFOLIOAs Australia s largest domestic gas producer,Santos is in a unique position to help Australia and the Asia-Pacifi c signifi cantly cut greenhouse gas emiss

131、ions through natural gas.By increasing the use of natural gas as a source of electricity generation,Australia can immediately and signifi cantly reduce its carbon footprint,while supporting the development of intermittent renewable power technology.By progressively replacing coal-fi red power genera

132、tion,natural gas can underwrite a 20%reduction in carbon emissions from electricity generation while still doubling the level of power available to Australian industry and homes.Australia has a natural gas resource base equivalent to hundreds of years of current use.Natural gas is also affordable;pr

133、ices in eastern Australia are among the cheapest in the OECD.A BRIGHT FUTURE FOR THE COOPERThe Cooper Basin has been the heartland of Santos for more than four decades and still retains signifi cant development potential.Santos is working to unlock its signifi cant gas resources through infi ll dril

134、ling and by tapping unconventional reservoirs.Infi ll drilling involves drilling multiple wells across areas where previously only one would be drilled a method that will produce previously uncommercial gas from within existing fi elds.Longer term,Santos is building its ability to produce from uncon

135、ventional resources.An audit of the Cooper Basin has shown vast amounts of unconventional shale gas and tight gas resources.Already,the company is producing shale gas from one of its wells.Santos believes gas demand in Australia s eastern states will grow signifi cantly as the region seeks cleaner e

136、nergy through gas-fi red power plants.Established infrastructure and access to extensive pipeline networks positions the Cooper Basin to play a large role in meeting that demand.NEW EASTERN AUSTRALIA PROJECTSIn the Otway Basin offshore Victoria,pipelay work to join the new Netherby and Henry gas fi

137、elds to the existing Casino production system began near the end of 2009.First gas was achieved in February 2010.Santos holds a 50%interest in this project.In the nearby Gippsland Basin,also offshore Victoria,work on the Kipper project is progressing well.Drilling is scheduled to commence in the fi

138、rst half of 2010,with fi rst gas scheduled for production in the fi rst half of 2011.Santos has a 35%interest in Kipper.The Shaw River Power Station project near Orford in western Victoria illustrates Santos recognition of the potential for natural gas to help Australia achieve cleaner electricity g

139、eneration.The proposed 500MW base load power station would be supplied with natural gas from Santos own gas portfolio.Feasibility work on the project is continuing.SIGNIFICANT WA BUSINESSSantos is a leading gas supplier in Western Australia and maintains a portfolio of quality growth opportunities.D

140、evelopment of the Reindeer project offshore Western Australia is well underway,with fi rst gas scheduled for the fourth quarter of 2011.Santos has a 45%interest in Reindeer,and has signed an agreement to supply CITIC Pacifi c s Sino Iron project.Other contracts are expected to follow.Production in S

141、antos other Western Australian assets,such as John Brookes,remained strong in 2009.GUNNEDAH EXPLORATIONSantos took the next major step in its strategic CSG strategy when it acquired signifi cant additional acreage in the Gunnedah Basin of New South Wales and invested in leading local CSG Company Eas

142、tern Star Gas.Santos and Eastern Star s total combined area of petroleum permits in the Gunnedah Basin is about 45,000 square kilometres.Since acquiring 35%interest in ESG operated acreage on 2 July 2009,2P reserves have increased by 1,184 PJ to 1,520 PJ gross.Wida Yarifa,an electrical and instrumen

143、t engineer with Santos contractor GPS.On an offshore gas rig in the Maleo fi eld,Indonesia.Santos Annual Report 200919AsiaStudents on the EcoBoat learn to balance environmental protection with economic development.ON BOARD THE ECOBOATSantos has partnered with Fauna&Flora International in the EcoBoat

144、 an interactive fl oating classroom in Vietnam s picturesque Ha Long Bay.The EcoBoat initiative gives local and international students hands-on experience in balancing environmental conservation with economic development.While staying on board the EcoBoat,students explore caves,talk to local communi

145、ties and businesses,learn marine safety,navigation,and scientifi c measurement of the natural environment.They use this experience to create their own sustainable vision for Ha Long Bay a World Heritage Site and national treasure.In Indonesia,Santos continued its commitment to working with local com

146、munities,helping local fi shermen and food business owners to improve their operations and create avenues to broader markets.Santos also installed 1.2 kilometres of pipeline to deliver clean water to village homes,and supported road development and coastal lighting.The company s focused Asia strateg

147、y continues to progress,with producing assets delivering strong performance in 2009 and multiple options for growth.The developing Wortel and Peluang prospects add to the producing Maleo and Oyong assets in Indonesia,the Chim So oil project in Vietnam has been formally approved,and exploration in th

148、e Bay of Bengal and the Kyrgyz Republic is progressing.INDONESIA:NEW PROJECT AND FURTHER GROWTHSantos Indonesian assets are now fi rmly established as part of the company s base business portfolio.The business has continued to display incremental growth in producing assets,and in 2009 brought the ne

149、w Oyong Phase-2 gas project online.The Phase-2 project included modifi cations to the existing offshore Oyong facilities and construction of a 60-kilometre pipeline to a new onshore gas processing facility.The project in East Java started production on schedule in the third quarter of 2009.The proje

150、ct was delivered safely,and was ramped up to production capacity within 20 days.Oil production from Oyong began in September 2007,and to date has produced more than four million barrels.The nearby Wortel development is proposed to be tied back to Oyong.A fi nal investment decision for Wortel is targ

151、eted for mid-2010,with fi rst gas forecast for the second half of 2011.Also in East Java,the Maleo gas fi eld continued to produce strongly.The nearby Peluang-1 well was drilled in the fi rst quarter of 2009,and has the potential to tie back to Maleo to maintain plateau production levels.FIRST OIL P

152、ROJECT IN VIETNAMSantos fi rst oil project in Vietnam,Chim So,has been formally approved.Work on the wellhead platform is well underway and fi rst oil is expected in the second half of 2011.Santos has a 31.875%non-operating interest in the Chim So fi eld,which is located offshore southern Vietnam in

153、 the Nam Con Son Basin.Also in Vietnam,2D seismic surveys are complete in offshore Block 123 in the Phu Khanh Basin,north of Chim So and Dua.Drilling is planned there for 2011.BAY OF BENGAL AND BANGLADESHIn Santos offshore acreage in the Bay of Bengal,an extensive 3D seismic program began in 2009 an

154、d is largely complete.Santos is targeting natural gas,which could be sold to the domestic Indian market.Interpretation of seismic results is ongoing.Santos has two deep water exploration licences that cover about 16,500 square kilometres in the north of the Bay.They were awarded by the Indian Govern

155、ment in 2007 under the competitive New Exploration Licensing Policy.Santos has shot over 300 kilometres of 3D seismic which is being evaluated with a view to drilling in 2011-12.In Bangladesh,a well optimisation program is extending the life of the offshore Sangu fi eld.The Sangu fi eld has associat

156、ed onshore gas processing facilities,positioning Santos to feed the nearby Chittagong gas market.A 3D seismic program for the Magnama and South Sangu fi elds is planned for early 2010.KYRGYZ REPUBLIC:LEADING ACREAGE POSITIONSantos has established a leading acreage position in the Fergana Basin in th

157、e south of the Kyrgyz Republic.Santos holds interests in six prospecting licences covering approximately 2,700 square kilometres in the proven oil and gas province.2D seismic work has been completed and shallow drilling occurred in 2009.Deeper drilling is planned for 2010 and 2011 to further evaluat

158、e the potential of these assets.If successful,existing pipelines and refi neries will enable production to be brought on quickly and will provide multiple export options.Santos has secured an option for further acreage in the Fergana Basin,adding to production potential.Landholder adviser David Lobb

159、 with a native Queensland bottle tree,in the Coxon Creek area of Santos eastern Queensland coal seam gas fi elds.Santos Annual Report 200921SustainabilityApplying the principles of sustainability makes good business senseSPONSORSHIP BY AREA 2009%fundingSouth Australia 36.1%Australian School of Petro

160、leum 21.0%Royal Institution of Australia 15.0%Queensland 8.9%Victoria 8.8%Indonesia 6.6%Vietnam 1.7%Northern Territory 0.8%Western Australia 0.5%Papua New Guinea 0.1%New South Wales 0.1%EMPLOYEE TURNOVER%024682006200720082009OIL SPILL VOLUMES m305010015020025030035040045050055020062005200720082009Mo

161、onie East/Algester spillsCarindale spillSPONSORSHIP BY ACTIVITY 2009%fundingEducation 40%General community 30%Arts and culture 13%Environment 10%Indigenous 3%Conference/industry/govt 2%Youth 2%Santos recognises that an integrated sustainability framework delivers value beyond traditional economic me

162、asures.To achieve this Santos has established targets across 24 sustainability indicators,six for each of four categories:environment,community,our people,and economic.Target scores were achieved for 75%of these indicators,with the rest on track for achievement in 2010.Key indicator improvements ach

163、ieved in 2009 include:climate change management safety TRCFR incidents and spills waste management.The effi ciency and effectiveness with which Santos manages environmental resources is the pathway to keeping the company s licence to operate in communities and with government regulators.Reducing gre

164、enhouse gas emissions,the use of clean water,land disturbance and waste to landfi ll contributes to the key concept of doing more with less and has a positive effect on operating and regulatory costs ultimately benefi ting both Santos and the environment.SUSTAINABILITY REPORT 2009Santos Sustainabili

165、ty Report 2009 provides a detailed annual review of its sustainability scorecard performance( sustained focus on safety contributed to the lowest injury rate level in Santos history,this result was built on strong safety systems and a series of initiatives that were implemented to improve Santos foc

166、us on safety.Low employee turnover is an indication of a committed,engaged and proactive workforce.During this period employee turnover reduced to just 3.5%.Santos greenhouse gas emissions profi le has reduced from over fi ve million tonnes in 2005 to less than 3.5 million tonnes.Energy effi ciency

167、projects implemented in 2009 will save approximately 1,095 TJ of gas per year.Santos integrity management program and training programs helped deliver signifi cant reductions of oil spill volumes in 2009.Santos sponsorship program is geographically distributed in a manner consistent with the spread

168、of the companys operations in each area.Santos community support program provides assistance to education,environment,art and culture and a range of youth and indigenous initiatives.GREENHOUSE GAS EMISSIONS FROM OPERATED ASSETS Million tonnes CO2-e(Scope 1)AustraliaIndonesiaUnited States0.00.51.01.5

169、2.02.53.03.54.04.55.05.520042005200620072008FY08-09TOTAL RECORDABLE CASE FREQUENCY RATE Recordable injuries per million hours worked0246810ContractorsCombinedEmployees2006200720082009ROY ALEXANDER FRANKLIN OBEBSc(Hons)Age 56.Independent non-executive Director since 28 September 2006 and member of th

170、e Environment,Health,Safety and Sustainability Committee of the Board.Non-executive director of Keller Group Plc since July 2007 and Chairman since August 2009.Non-executive director of StatoilHydro ASA since October 2007.Former non-executive Chairman of Bateman Litwin NV and Novera Energy Plc.Forme

171、r Chief Executive Offi cer of Paladin Resources Plc 1997-2005 and former Group Managing Director of Clyde Petroleum Plc.Former Chairman of BRINDEX,the trade association for UK independent oil and gas companies 2002-2005 and a former member of PILOT,the joint industry/UK Government task force set up

172、to maximise hydrocarbon recovery from the UK North Sea 2002-2005.In 2004 awarded the OBE for services to the UK oil and gas industry.KENNETH ALFRED DEANBCom(Hons),FCPA,MAICDAge 57.Independent non-executive Director since 23 February 2005.Chairman of the Audit Committee and member of the Finance Comm

173、ittee of the Board.Director of Santos Finance Ltd since 30 September 2005.Non-executive Director of Bluescope Steel and Chair of Bluescope s Audit&Risk Committee.Chief Financial Offi cer of Alumina Ltd October 2005-February 2009,alternate director of Alumina Ltd October 2005-February 2009 and non-ex

174、ecutive director of Alcoa of Australia Ltd,Alcoa World Alumina LLC and related companies October 2005-February 2009.Director of Shell Australia Ltd from 1997 to 2001 and Woodside Petroleum Ltd from 1998 to 2004.Over 35 years experience in the oil and gas industry.Fellow of the Australian Society of

175、Certifi ed Practising Accountants and member of the Australian Institute of Company Directors.Former Chief Executive Offi cer of Shell Financial Services and member of the La Trobe University Council.DAVID JOHN WISSLER KNOXChief Executive Offi cer and Managing DirectorBSc(Hons)Mech Eng,MBAAge 52.Joi

176、ned Santos in September 2007 as Executive Vice President Growth Businesses.Appointed Acting Chief Executive Offi cer in March 2008 and Chief Executive Offi cer and Managing Director in July 2008.Member of the Environment,Health,Safety and Sustainability Committee of the Board.Director of Santos Fina

177、nce Limited.Previously Managing Director of BP Exploration&Production in Australasia and an Executive Member of APPEA.David has a wealth of upstream oil and gas experience,having held management and engineering roles at BP,ARCO and Shell across Australia,United Kingdom,Pakistan,United States,Netherl

178、ands and Norway.Also a director on the Board of the Botanic Gardens and State Herbarium,South Australia and a Fellow of the Australian Institute of Mechanical Engineering.PETER ROLAND COATES AOChairmanBSc(Mining Engineering)Age 64.Appointed Santos Chairman on 9 December 2009.Previously an independen

179、t non-executive Director since 18 March 2008.Chairman of the Remuneration Committee of the Board,the Nomination Committee of the Board and the Santos Finance Limited Board.Member of the Finance Committee of the Board.Former non-executive Chairman of Xstrata Australia.Previously Chief Executive of Xs

180、trata Coal,Xstrata Plc s global coal business.Appointed non-executive director of Minara Resources Limited in April 2008 and appointed Chairman in May 2008.Non-executive director of Amalgamated Holdings Limited since July 2009.Past Chairman of the Minerals Council of Australia,the NSW Minerals Counc

181、il and the Australian Coal Association.Member of the APEC 2007 Business Consultative Group and the Emissions Trading Task Group.Current member of the NSW Minerals Ministerial Advisory Council and the Business Council of Australia.Board of DirectorsRICHARD MICHAEL HARDINGMScAge 60.Independent non-exe

182、cutive Director since 1 March 2004.Chairman of the Environment,Health,Safety and Sustainability Committee of the Board.Member of the Audit,Nomination and Remuneration Committees of the Board.Independent non-executive Chairman of Clough Ltd,having been appointed as director in May 2006.Non-executive

183、director of Downer EDI Limited since July 2008.Non-executive Deputy Chairman of Arc Energy Ltd until May 2007(appointed as non-executive director in August 2003).Chairman of the Ministry of Defence Project Governance Board Land Systems Division(Army)2003February 2009.Former President and General Man

184、ager of BP Developments Australia Ltd with over 25 years of extensive international experience with BP.Former Vice-Chairman and Council member of the Australian Petroleum Production and Exploration Association(APPEA).KENNETH CHARLES BORDALLB,BAAge 57.Independent non-executive Director since 14 Febru

185、ary 2007.Chairman of the Finance Committee of the Board and member of the Nomination Committee of the Board.Board member of Fullerton Funds Management,owned by Temasek,Singapore,since February 2007.Non-executive director of Ithmaar Bank(Bahrain)since February 2007 and Leighton Contractors Pty Ltd si

186、nce July 2007.Appointed a director of Talent2 International Ltd in August 2008 and the Asian Advisory Board of Aviva Pte Ltd in Singapore in February 2009.Previously a Board member of SFE Corporation for over fi ve years until its acquisition by the Australian Stock Exchange Ltd in July 2006.CEO of

187、Middle East and North Africa,Deutsche Bank before retirement in May 2007.Formerly Regional CEO Asia Pacifi c and CEO Australia and New Zealand,Deutsche Bank.Director of Deutsche Bank Malaysia from 2002 until retirement in May 2007.JANE SHARMAN HEMSTRITCHBSc,FCAAge 56.Independent non-executive direct

188、or since 16 February 2010.Member of the Remuneration Committee of the Board and the Audit Committee of the Board.Non-executive director of the Commonwealth Bank of Australia since October 2006,The Global Foundation since November 2006 and Tabcorp Holdings Ltd since November 2008.Member of the Resear

189、ch and Policy Council and Advisory Committee of the Committee for Economic Development of Australia.25 years experience with Accenture and Andersen Consulting.Previously Asia Pacifi c Managing Director,Country Managing Director for Australia and member of Accenture s Executive Leadership Team 2004-2

190、007.Past roles also include Managing Partner of Accenture s Communications and HighTech Operating Unit for Asia Pacifi c and of Accenture s Communications and HighTech Practice for Australia and New ZealandGREGORY JOHN WALTON MARTINBEc,LLB,FAIM,MAICDAge 50.Independent non-executive Director since 29

191、 October 2009.Member of the Remuneration Committee of the Board and the Environment,Health,Safety and Sustainability Committee of the Board.Non-executive director of Energy Developments Limited and the Australian Energy Market Operator Limited.Chairman of Everest Financial Group,Gas Valpo S.A.(Chile

192、)and the Royal Botanic Gardens&Domain Trust of New South Wales.Previous Deputy Chairman of the Australian Gas Association and inaugural Chairman of the Energy Supply Association of Australia between 2004 and 2006.Former Chairman of Jackgreen Limited.Past member of the Business Council of Australia a

193、nd Committee for the Economic Development of Australia.Formerly Managing Director and Chief Executive Offi cer of AGL,and Chief Executive Infrastructure at Challenger Financial Services Group.Santos Leadership TeamJOHN ANDERSONVice President Western Australia and Northern TerritoryLLB,BEc,GDCLJohn A

194、nderson is responsible for Santos activities in Western Australia and Northern Territory,including commercial and fi nance,business development,exploration,development and operated assets.John joined Santos in 1996 as Corporate Counsel for the former Queensland Northern Territory Business Unit after

195、 10 years as a solicitor with Freehills.He has held a range of roles at Santos including Manager Legal and Business Services,Group Executive Business Development,Vice President Strategic Projects and most recently Vice President Commercial.MARTYN EAMESVice President Asia Pacifi cBSc(Hons)Martyn Eame

196、s is responsible for Santos activities in the Asia Pacifi c region.These comprise Santos business interests in Indonesia,Papua New Guinea,India,Bangladesh,Kyrgyz Republic and Vietnam.Martyn joined Santos in December 2004 as Vice President Corporate and People.Before then,he spent more than 25 years

197、with BP,working various upstream roles in Angola,Canada,Australia,Papua New Guinea,Norway,United Kingdom and United States.PETRINA COVENTRYChief Human Resources Offi cerBEd,PostDipHR,Master Business EthicsPetrina Coventry is responsible for human resources strategy and activities throughout Santos,i

198、ncluding remuneration and benefi ts,organisational effectiveness,talent management,learning and development,recruitment and payroll.Petrina has spent many years working in the US,Asia and Europe in global human resource management roles for The General Electric Company and The Coca Cola Company.Her

199、most recent role was Chief Human Resource Offi cer for a private equity consortium in Singapore.She has deep industry knowledge across many industrial sectors including renewable energy,oil and gas services,real estate and fi nancial services.DAVID KNOX Chief Executive Offi cer and Managing Director

200、BSc(Hons)Mech Eng,MBADavid Knox was appointed Chief Executive Offi cer of Santos in July 2008.He has 25 years of experience in the global oil and gas industry,including as Managing Director for BP Developments in Australasia from 2003 to 2007.David Knox joined Santos in September 2007 as Executive V

201、ice President,Growth Businesses,responsible for growth in Santos emerging new businesses including LNG,Geoscience and New Ventures,Indonesia and other strategic projects.Originally from Edinburgh,Scotland,David holds a fi rst class honours degree in Mechanical Engineering from Edinburgh University a

202、nd a Masters of Business Administration from the University of Strathclyde.David Knox has previously held senior positions with BP in Australia,the United Kingdom and Pakistan.He has worked for ARCO and Shell in the United States,Netherlands,the United Kingdom and Norway.ROGER KENNETTVice President

203、GLNG OperationsBSc Chemical TechnologyRoger Kennett is responsible for the project management,engineering,construction and operation of the coal seam gas fi eld development in eastern Queensland,the 435-kilometre pipeline from Fairview to Gladstone,and the GLNG plant and facilities on Curtis Island.

204、Roger joined Santos in 1984,and has held a range of operations and technical leadership roles during his 25 year career with Santos.His most recent role was Vice President Operations.Before joining Santos,Roger worked for 13 years in chemical and fertiliser industries.PETER WASOWChief Financial Offi

205、 cer and Executive Vice PresidentBCom,GradDipMgmt,FCPAPeter Wasow is responsible for strategy and planning,corporate fi nance,accounting,taxation,treasury,investor relations,risk and audit,and public affairs.Peter joined Santos in May 2002 following a 23-year career with BHP Billiton.His roles inclu

206、ded Vice President Finance and Administration for BHP Petroleum in Houston,Texas.His most recent role was Vice President Finance,in the BHP corporate offi ce.RAY BETROSVice President TechnicalBEng Chemical,GradDip Process Plant Engineering Ray Betros is responsible for driving overall performance;en

207、hancing Santos technical excellence across subsurface and surface engineering disciplines;leading environment,health and safety and clean energy strategies;and overseeing delivery of key technical services(drilling,IT,and procurement and logistics).Ray joined Santos in January 2009 from BG Group whe

208、re he was the Technical Director and Chief Operating Offi cer for the Asian,Middle Eastern and African regions.During his more than 30-year career,he has also held senior positions with BHP Billiton and Hoechst.TREVOR BROWNVice President ExplorationBSc(Hons)Trevor Brown is responsible for implementi

209、ng Santos exploration and new ventures strategy and for building a material portfolio of growth opportunities.Trevor also leads a team of highly qualifi ed geoscientists and subsurface engineers ensuring the application of subsurface excellence across all Santos conventional and unconventional explo

210、ration,appraisal and development activities.Trevor joined Santos in 2001 from the US independent oil company Unocal where he was part of a very active exploration team gaining experience across SE Asia,the United States and South America.His previous roles at Santos include Manager New Ventures,Mana

211、ger Growth Projects and Vice President Geoscience and New Ventures.Trevor has over 24 years experience in the oil and gas industry including 11 years in Indonesia managing onshore and offshore exploration programs.JAMES BAULDERSTONEVice President Corporate Development and LegalLLB(Hons),BSc(Hons)Jam

212、es Baulderstone is responsible for the M&A team and has functional responsibility for Commercial and Marketing Excellence,Legal and Secretariat.James is also General Counsel and Company Secretary of the Santos Group.James joined Santos in January 2007 after holding similar roles at Mayne Group and B

213、lueScope Steel.James has extensive legal,commercial and business development experience across many countries including the United States,Germany,United Kingdom,Malaysia,China and India.RICK WILKINSONPresident GLNG and QueenslandBSc(Hons)Rick Wilkinson is responsible for Santos Queensland assets,inc

214、luding the GLNG business and LNG marketing.Rick was formerly Vice President Commercial.Before joining Santos in 1997,he was Group Manager Energy Retail for the Victorian Gas and Fuel Corporation,responsible for energy trading,customer relations,marketing and sales.He has also held various engineerin

215、g,strategy and management positions with Schlumberger,McKinsey&Co and Pilkington Glass.MARK MACFARLANEVice President Eastern AustraliaBEng(Hons)MechanicalMark Macfarlane is responsible for Santos eastern Australia activities,including commercial and fi nance,business development,exploration and deve

216、lopment,production operations,plant operations and reliability,and human resources.Mark joined Santos in 1997 after a nine-year career with Esso in Australia and Malaysia.He has worked in a variety of leadership roles at Santos,including reservoir management,corporate planning,gas and oil exploitati

217、on and optimisation,and operations.Mark s most recent role was Vice President Development.Santos Annual Report 200926Corporate governanceINTRODUCTIONThe Board and management of Santos believe that,for the Company to achieve its vision of becoming a leading energy company for Australia and Asia,it is

218、 necessary for the Company to meet the highest standards of personnel safety and environmental performance,governance and business conduct across its operations in Australia and internationally.To achieve the highest standards of corporate governance,the Board has established corporate governance po

219、licies and charters(Policies).The Policies,or a summary of the Policies,are publicly available on the Company s website,.The Company s Policies meet the requirements of both the Corporations Act 2001(Cth)(the Act)and the Listing Rules of the Australian Securities Exchange(ASX),and,in the opinion of

220、the Board,comply with best practice,including the ASX Principles of Good Corporate Governance and Good Practice Recommendations(ASX Principles).The table on page 27 indicates where specifi c ASX Principles are dealt with in this Statement.PART 1:COMPOSITION OF THE BOARD1.1 CompositionThe composition

221、 of the Board is determined in accordance with the Company s Constitution and the Board Guidelines which,among other things,require that:the Board comprises a minimum of fi ve directors(exclusive of the Chief Executive Offi cer/Managing Director(CEO),and a maximum of ten directors;the Board should c

222、omprise a substantial majority of independent,non-executive Directors;there should be a separation of the roles of Chairman and CEO of the Company;the Chairman of the Board should be an independent,non-executive Director;and performance of the Board and its members should be reviewed regularly and o

223、bjectively.The names and details of the experience,qualifi cations,special responsibilities,and term of offi ce of each Director of the Company and the Company Secretary are set out on pages 22 to 25 of this Annual Report.In 2009:Chairman Mr Stephen Gerlach retired from the Company s Board.Mr Peter

224、Coates assumed the role of Chairman,having been appointed Deputy Chairman in 2008 as part of the Board s succession planning process.As part of the Company s Board renewal process,Professor Judith Sloan retired from the Board on 6 May 2009 and,in October 2009,Mr Gregory Martin was appointed a Direct

225、or and,in February 2010 Ms Jane Hemstritch was also appointed a Director.1.2 Director independenceThe Board has adopted the defi nition of independence set out in the ASX Principles.Having regard to this defi nition,the Board generally considers a Director to be independent if he or she is not a mem

226、ber of Management and is free of any interest and any business or other relationship which could,or could reasonably be perceived to,materially interfere with the Director s ability to act in the best interests of the Company.The Board will assess the materiality of any given relationship that may a

227、ffect independence on a case-by-case basis and has adopted materiality guidelines to assist in that assessment.Under these guidelines,the following interests are regarded as material in the absence of any mitigating factors:a holding of 5%or more of the Company s voting shares or a direct associatio

228、n with an entity that holds more than 5%of the Company s voting shares;or an affi liation with an entity which accounts for 5%or more of the revenue or expense of the Company.Each Director s independence is assessed by the Board on an individual basis,with reference to the above materiality guidelin

229、es and focusing on an assessment of each Director s capacity to bring independence of judgement to Board decisions.In this context,Directors are required to promptly disclose to the Board their interests in contracts,family ties and cross-directorships which may be relevant in considering their inde

230、pendence.Currently,the Board comprises seven non-executive Directors,all of whom are considered independent under the principles set out above,and one executive Director(the Managing Director/CEO).1.3 Conflicts of interestThe Board has an obligation to ensure that Directors avoid confl icts between

231、their duty to the Company and their own personal interests.Directors are required to declare actual or potential confl icts of interest both on their appointment to the Board and on an ongoing basis.For example,Directors must declare any confl ict of interest that they may have at the start of all B

232、oard meetings.Where a material personal interest arises with respect to a matter that is to be considered by the Board,the Director is required to declare that interest and must not take part in any Board discussion or vote in relation to that matter,unless permitted in accordance with the Act.Relev

233、ant policies and chartersSee Board Guidelines Company ConstitutionSantos Annual Report 200927Principles and RecommendationsSectionPrinciple 1 Lay solid foundations for management and oversight1.1 Establish and disclose the functions reserved to the Board and those delegated to management.2.11.2 Disc

234、lose the process for evaluating the performance of senior executives.1.61.3 Provide the information indicated in the guide to reporting on Principle 1.1.6,2Principle 2 Structure the Board to add value2.1 A majority of the Board should be independent Directors.1.22.2 The chairperson should be an inde

235、pendent Director.1.12.3 The roles of chairperson and chief executive offi cer should not be exercised by the same individual.1.12.4 The Board should establish a Nomination Committee consisting of a minimum of 3 members,the majority being independent Directors.3.1,3.2,3.32.5 Disclose the process for

236、evaluating the performance of the Board,its committees and individual directors.1.62.6 Provide the information indicated in the guide to reporting on Principle 2.1.1,1.2,1.4,1.6,2.2,3.1,3.2,3.3Principle 3 Promote ethical and responsible decision-making3.1 Establish a code of conduct to guide the Dir

237、ectors,the chief executive offi cer(or equivalent),the chief fi nancial offi cer(or equivalent)and any other key executives as to:5.1,5.23.1.1 the practices necessary to maintain confi dence in the Company s integrity;3.1.2 the practices necessary to take into account their legal obligations and the

238、 reasonable expectations of stakeholders.3.1.3 the responsibility and accountability of individuals for reporting and investigating reports of unethical practices.3.2 Disclose the policy concerning trading in Company securities by Directors,senior executives and employees.5.33.3 Provide the informat

239、ion indicated in the guide to reporting on Principle 3.5.1,5.2,5.3Principle 4 Safeguard integrity in fi nancial reporting4.1 The Board should establish an Audit Committee.3.2,3.34.2 Structure the Audit Committee so that it:3.1,3.2,3.3 consists only of non-executive Directors;consists of a majority o

240、f independent Directors;is chaired by an independent chair,who is not a chair of the Board;and has at least three members.4.3 The Audit Committee should have a formal charter.34.4 Provide the information indicated in the guide to reporting on Principle 4.3.2Principle 5 Make timely and balanced discl

241、osure5.1 Establish and disclose written policies and procedures designed to ensure compliance with ASX Listing Rule disclosure requirements and to ensure accountability at a senior management level for that compliance.55.2 Provide the information indicated in the guide to reporting on Principle 5.5P

242、rinciple 6 Respect the rights of shareholders6.1 Design and disclose a communications strategy to promote effective communication with shareholders and encourage effective participation at general meetings.5.46.2 Provide the information indicated in the guide to reporting on Principle 6.5.4Principle

243、 7 Recognise and manage risk7.1 Establish policies for the oversight and management of material business risks and disclose a summary of those policies.4.17.2 Require management to design and implement the risk management and internal control system to manage the company s material business risks an

244、d report to the Board on whether those risks are being managed effectively.4.1,4.27.3 Disclose whether the Board has received assurance from the chief executive offi cer and the chief fi nancial offi cer that the declaration provided under s295A of the Act is founded on a sound system of risk manage

245、ment and internal control that is operating effectively in all material respects in relation to fi nancial reporting risks.4.27.4 Provide the information indicated in the guide to reporting on Principle 7.4.1,4.2Principle 8 Remunerate fairly and responsibly8.1 The Board should establish a remunerati

246、on committee.3.2,3.38.2 Distinguish the structure of non-executive Directors remuneration from that of executive Directors and senior executives.3.38.3 Provide the information indicated in the guide to reporting on Principle 8.3.2,3.3Santos Annual Report 200928Corporate governance(continued)1.4 Appo

247、intment of new Directors,term of office and re-electionThe Board Guidelines include the following principles:non-executive Directors are to be appointed on the basis that their nomination for re-election as a Director is subject to review and support by the Board;there should be appropriate circumst

248、ances justifying re-election after a specifi ed period of service as a Director;and the contribution of the Board,Board Committees,and of individual Directors is the subject of formal review and discussion in accordance with the process set out below.Prospective candidates for election and re-electi

249、on to the Board are reviewed by the Nomination Committee.The Committee considers the business experience,skills and expertise of the candidates and the requirements of the Board,to ensure that the Board s overall composition enables it to meet its responsibilities.The Nomination Committee makes appr

250、opriate recommendations to the Board regarding possible appointments of Directors.Under the Company s Constitution,approximately one third of Directors retire by rotation each year.Directors appointed during the year are also required to submit themselves for election by shareholders at the Company

251、s next Annual General Meeting.The Nomination Committee considers candidates for re-election and makes recommendations to the Board,taking into account performance,internal and external Board and Director review results and the requirements of the Board.In 2009,the following changes in the directorsh

252、ip of the Company took place as part of the Board renewal process:Mr Stephen Gerlach retired as Chairman of the Company on 9 December 2009 and as a Director on 31 December 2009;Mr Peter Coates assumed the role of Chairman on 9 December 2009;Professor Judith Sloan retired from the Board on 6 May 2009

253、;and Mr Gregory Martin was appointed a Director on 29 October 2009.The Board renewal process is overseen by the Nomination Committee and involves regularly reviewing the composition of the Board to ensure that the Directors have the necessary experience,skills and expertise to manage a leading energ

254、y company.Throughout 2009,the Nomination Committee had been actively seeking appropriate candidates for appointment to the Board to replace Mr Gerlach.In February 2010,the Board appointed Ms Hemstritch as a Director.The details of Ms Hemstritch s experience and qualifi cations are set out on page 23

255、 of the Annual Report.1.5 Director induction and continuing educationPrior to appointment,each Director is provided with a letter of appointment which includes copies of the Company s Constitution,Board Guidelines,Committee Charters,relevant policies and functional overviews of the Company s strateg

256、ic objectives and operations.Additionally,the expectations of the Board in respect to a proposed appointee to the Board and the workings of the Board and its Committees are conveyed in interviews with the Chairman.Induction procedures include access to appropriate executives in relation to details o

257、f the business of the Company.Directors are encouraged by the Board to continue their education by attending both internal and external training and education relevant to their role.1.6 Review of Board,Director and executive performanceOrdinarily,an external review of the Board and individual Direct

258、ors is carried out on a biennial basis and internal reviews of individual Directors are conducted annually.The external reviews are carried out by an independent consultant,based on a scope agreed in advance with the Board.Internal reviews are facilitated by the Chairman,in consultation with the Nom

259、ination Committee,and involve formal interviews with each Director culminating in a written report prepared by the Chairman.With the change of Chairman and other Board renewal changes taking place in 2009,the Board review in 2009 was via an internal review conducted by the incoming Chairman.In 2010,

260、it is expected that an external review will be undertaken of the Board as a whole,together with peer review of all individual Directors.Board Committees conduct their own internal review of their performance,structure,objectives and purpose from time to time.Performance evaluation of senior executiv

261、es is undertaken twice a year by the CEO,the results of which are used by him in association with the Remuneration Committee in determining future remuneration and generally for review by the Board in relation to management succession planning.Performance reviews were conducted for each of the senio

262、r executives,including the CEO,during the year.These reviews were carried out in accordance with the process set out above against the following criteria:analysing performance against agreed measures;examining the effectiveness and quality of the individual in their given role;assessing key contribu

263、tions;identifying areas of potential improvement;and assessing whether various expectations of shareholders have been met.Santos Annual Report 200929As a result of recommendations arising from the internal Board review,a number of initiatives have been introduced to ensure the continued effectivenes

264、s of the Board s performance and enable its sustained focus on key issues for the Company.The performance evaluations of senior executives that were conducted in accordance with the above procedures directly impacted their short term incentives.Details of the remuneration received by Directors and s

265、enior executives are set out in the Remuneration Report commencing on page 52 of the Annual Report.PART 2:BOARD RESPONSIBILITIESIn addition to the Board Guidelines,the Board has adopted a formal document outlining the Role of the Board.The overriding objective is to increase shareholder value to top

266、 quartile performance.The Board endeavours to do this by use of a management framework which protects the rights and interests of shareholders and ensures the Company is properly managed through the implementation of sound strategies and action plans and the development of an integrated framework of

267、 risk management and control over the Company s economic resources.2.1 ResponsibilitiesThe Board is responsible for the overall corporate governance of the Company,including approving the strategic direction and fi nancial objectives,oversight of the Company and its management,establishing goals for

268、 management and monitoring the attainment of these goals.Specifi cally,the Board is responsible for:the oversight of the Company s strategic direction management of the Company;the approval of delegations of authority to management;signifi cant acquisitions and disposals of assets;signifi cant expen

269、diture decisions outside of the Board-approved corporate budget including hedging of product sales,sales contracts and fi nancing arrangements;the approval of,and monitoring of,fi nancial performance against strategic plans and corporate budgets;approving ethical standards and codes of conduct;the s

270、election and evaluation of,and succession planning for,Directors,CEO,CFO and Company Secretary and general endorsement of the same for other executives reporting to the CEO;the remuneration of Directors and the CEO and general endorsement of the same for other executives reporting to the CEO;oversig

271、ht of the integrity of material business risk management including fi nancial and non-fi nancial risks.The Board has also established a number of Board Committees to assist with the effective discharge of its duties.Each Director is required to ensure that they are able to devote suffi cient time to

272、 discharge their duties and to prepare for Board and Committee meetings and associated activities.The Board delegates management of the Company s resources to the Company s executive management team,under the leadership of the CEO,to deliver the strategic direction and goals approved by the Board.Th

273、is is formally documented in the Company s Delegation of Authority which details the responsibilities delegated by the Board to Management for:implementing corporate strategies;and operating under approved budgets and written delegations of authority.2.2 Indemnity,access to information and independe

274、nt professional adviceThe Board Guidelines set out the circumstances and procedures pursuant to which a Director,in furtherance of his or her duties,may seek independent professional advice at the Company s expense.Those procedures require prior consultation with,and approval by,the Chairman and ass

275、urances as to the qualifi cations and reasonableness of the fees of the relevant expert and,under normal circumstances,the provision of the expert s advice to the Board.Pursuant to a deed executed by the Company and each Director,a Director also has the right to access all documents which have been

276、presented to meetings of the Board or to any Committee of the Board or otherwise made available to the Director whilst in offi ce.This right continues for a term of seven years after ceasing to be a Director or such longer period as is necessary to determine relevant legal proceedings that commenced

277、 during that term.Information in respect of indemnity and insurance arrangements for Directors and certain senior executives appears in the Directors Statutory Report on page 47 of this Annual Report.Relevant policies and chartersSee Board GuidelinesSantos Annual Report 200930PART 3:BOARD COMMITTEES

278、3.1 Role and membershipThe Board has established a number of Committees to assist with the effective discharge of its duties.The membership and role of each Committee is set out in section 3.3.All Committees are chaired by and comprise only non-executive,independent Directors,except the Environment,

279、Health,Safety and Sustainability Committee,which includes the CEO as a member.Other composition requirements specifi c to the individual Committee are set out in section 3.3.Non-Committee members may attend Committee meetings by invitation.Each Committee operates under a specifi c charter approved b

280、y the Board.The Board Committee Charters have been reviewed in accordance with the revised ASX Principles.Board Committees have access to internal and external resources,including access to advice from external consultants or specialists without management present.The Chairman of each Committee prov

281、ides an oral,and,where practicable,a written report together with the minutes and recommendations of the Committee at the next Board meeting.As a result of changes in directorship of the Company(as outlined in section 1.4),the Board reviewed the Board Committee memberships to ensure that the members

282、 of each Committee have the requisite expertise and skill.As a result of this review,the following changes to Committee membership occurred in February 2010:Mr Gregory Martin was appointed to the Remuneration Committee with effect from 1 February 2010 and the Environment,Health,Safety and Sustainabi

283、lity Committee with effect from 17 February 2010;Relevant policies and chartersSee Audit Committee Charter Environment,Health,Safety&Sustainability Committee Charter Finance Committee Charter Nomination Committee Charter Remuneration Committee CharterCorporate governance(continued)Audit CommitteeEnv

284、ironment,Health,Safety&Sustainability CommitteeFinance CommitteeNomination CommitteeRemuneration CommitteeKC Borda1 Non-executive DirectorChairmanMemberPR Coates2Non-executive Director(Deputy Chairman/Chairman)MemberMemberMemberChairmanChairmanKA DeanNon-executive DirectorChairmanMemberRA FranklinNo

285、n-executive DirectorMemberS Gerlach3Non-executive Director(Chairman)MemberMemberChairmanMemberRM HardingNon-executive DirectorMemberChairmanMemberMemberDJW KnoxExecutive Director(Managing Director/CEO)MemberJ Sloan4Non-executive DirectorMemberGJW Martin5Non-executive DirectorMemberMemberJS Hemstritc

286、h6Non-executive DirectorMemberMember1 Mr Kenneth Borda was appointed to the Nomination Committee with effect from 17 February 2010.2 Mr Peter Coates assumed the role of Chairman on 9 December 2009 and increased his Board Committee responsibilities by becoming Chairman of the Nomination Committee and

287、 a member of the Environment,Health,Safety and Sustainability Committee and the Finance Committee on 31 December 2009.Mr Coates ceased to be a member of the Audit Committee on 31 December 2009 and the Environment,Health,Safety and Sustainability Committee on 17 February 2010.3 Mr Stephen Gerlach ret

288、ired from the Board on 31 December and at that time ceased to be a member of any Board Committee.4 Professor Judith Sloan retired from the Board on 6 May 2009 and at that time ceased to be a member of the Nomination Committee.5 Mr Gregory Martin was appointed a Director on 29 October 2009,and a memb

289、er of the Remuneration Committee with effect from 1 February 2010,and the Environment,Health,Safety and Sustainability Committee with effect from 17 February 2010.6 Ms Jane Hemstritch was appointed a Director on 16 February 2010,and a member of the Remuneration Committee and Audit Committee with eff

290、ect from 17 February 2010.Board CommitteesSantos Annual Report 2009313.3 Role and Membership of Committees CommitteeMembers and CompositionRoleAuditMr KA Dean(Chairman)Mr RM HardingMs JS HemstritchThe Committee is required to consist of:members who are fi nancially literate;at least one member with

291、past employment experience in fi nance and accounting,requisite professional certifi cation in accounting or other comparable experience or background;and at least one member with an understanding of the exploration and production industry.The Chairman of the Board is precluded from being the Chairm

292、an of the Audit Committee.The primary objective of the Audit Committee is to assist the Board to fulfi l its corporate governance and oversight responsibilities related to fi nancial accounting practices,external fi nancial reporting,fi nancial risk management and internal control,the internal and e

293、xternal audit function,and compliance with laws and regulations relating to these areas of responsibility.Specifi cally,the role of the Audit Committee includes:reviewing the effectiveness of the Company s risk management and internal compliance and control systems relating to fi nancial reporting;e

294、valuating the truth and fairness of Company fi nancial reports and recommending acceptance to the Board;reviewing the process adopted by the CEO and Chief Financial Offi cer(CFO)when certifying to the Board that the Company s fi nancial reports are true and fair and that they are based on a sound sy

295、stem of risk management and internal compliance and control that is operating effectively in all material respects;examining the accounting policies of the Company to determine whether they are appropriate and in accordance with generally accepted practices;meeting regularly with the internal and ex

296、ternal auditors to reinforce their respective independence and to determine the appropriateness of internal and external audit procedures;where the external auditor provides non-audit services,reporting to the Board as to whether the Committee is satisfi ed that the provision of those services has n

297、ot compromised the auditor s independence;reviewing the performance of the internal and external auditors and providing them with confi dential access to the Board;receiving from the external auditors a formal written statement delineating all relationships between the auditors and the Company and c

298、onfi rming compliance with all professional and regulatory requirements relating to auditor independence;referring matters of concern to the Board,as appropriate,and considering issues which may impact on the fi nancial reports of the Company;recommending proposed dividends to the Board for fi nal a

299、doption;and recommending to the Board the appointment and dismissal of the head of internal audit.Mr Peter Coates ceased to be a member of the Environment,Health,Safety and Sustainability Committee on 17 February 2010;Ms Jane Hemstritch was appointed to the Remuneration Committee and the Audit Commi

300、ttee with effect from 17 February 2010;and Mr Kenneth Borda was appointed to the Nomination Committee with effect from 17 February 2010.Following is a summary of the membership of the Board Committees.Details of the qualifi cations and experience of each Director is set out in pages 22 to 23.3.2 Boa

301、rd and Committee meetingsThe Board Guidelines prescribe that the Board is to meet at least eight times a year,including a strategy meeting.Board members are expected to attend any additional meetings as required.In 2009,a total of 12 meetings were held.Details of the Board and Committee meetings hel

302、d and attendances at those meetings appear in the Directors Statutory Report on page 44 of this Annual Report.In addition to the Board meetings,several meetings of the non-executive Directors are scheduled to take place each year.The Managing Director/CEO(as an executive Director)and members of mana

303、gement do not attend these meetings.Two meetings of the non-executive Directors were held in 2009.Also,in accordance with the Board Guidelines,at least four Board dinners are held each year,of which at least one is attended exclusively by non-executive Directors.Members of management attend Board an

304、d Committee meetings,at which they report to Directors within their respective areas of responsibility.Where appropriate,advisors to the Company attend meetings of the Board and of its Committees.Santos Annual Report 200932Corporate governance(continued)CommitteeMembers and CompositionRoleEnvironmen

305、t,Health,Safety and SustainabilityMr RM Harding(Chairman)Mr RA FranklinMr GJW MartinMr DJW KnoxDuring 2009,Mr Coates replaced Mr Gerlach as a member of the Environment,Health,Safety and Sustainability Committee on 31 December 2009.Mr Martin replaced Mr Coates as a member of the Environment,Health,Sa

306、fety and Sustainability Committee on 17 February 2010.The role of the Environment,Health,Safety and Sustainability Committee includes:monitoring and review of the Environment,Health and Safety and Greenhouse Policies and related systems;monitoring and review of the development of the Company s Susta

307、inability Management Framework and the performance of sustainability aspects of this framework under the categories of Environment,Community and Our People(excluding sustainability aspects under the category of Economy);and review of the regular internal and external environmental,health and safety

308、audits.NominationMr PR Coates(Chairman)Mr KC BordaMr RM HardingDuring 2009,Mr Coates was appointed to the Nomination Committee on 31 March 2009.Professor Sloan ceased to be a member of the Nomination Committee upon retiring from the Board on 6 May 2009 and Mr Gerlach upon his retirement on 31 Decemb

309、er 2009.Mr Borda was appointed a member of the Nomination Committee with effect from 17 February 2010.It is the responsibility of the Nomination Committee to devise the criteria for,and review membership of,and nominations to,the Board(including the re-election of incumbent Directors).The primary cr

310、iteria adopted in selection of suitable Board candidates,and the assessment of incumbent directors seeking re-election is their capacity to contribute to the ongoing development of the Company,having regard to the location and nature of the Company s signifi cant business interests and to the candid

311、ates qualifi cations and experience by reference to the attributes of existing Board members.When a Board vacancy exists or where it is considered that the Board would benefi t from the services of a new Director with particular skills,the Nomination Committee has responsibility for proposing candid

312、ates for consideration by the Board and,where appropriate,engages the services of external consultants.RemunerationMr PR Coates(Chairman)Mr RM HardingMs JS HemstritchMr GJW MartinDuring 2009,Mr Gerlach ceased to be a member of the Remuneration Committee on 31 December 2009.Mr Martin and Ms Hemstritc

313、h were appointed members of the Remuneration Committee with effect from 1 February and 17 February 2010,respectively.The Remuneration Committee is responsible for reviewing the remuneration policies and practices of the Company including:the compensation arrangements for the non-executive and execut

314、ive Directors(including the CEO),and senior executives;the Company s superannuation arrangements;and employee share and option plans.The Committee has access to independent advice and comparative studies on the appropriateness of remuneration arrangements.The structure and details of the remuneratio

315、n paid to Directors,the CEO and other senior executives during the period are set out in the Remuneration Report commencing on page 52 of this Annual Report and note 32 to the fi nancial statements commencing on page 70 of this Annual Report.FinanceMr KC Borda(Chairman)Mr PR CoatesMr KA DeanDuring 2

316、009,Mr Gerlach ceased to be a member of the Finance Committee on 31 December 2009 and Mr Coates was appointed a member of the Finance Committee with effect from 31 December 2009.The role of the Finance Committee includes:responsibility for considering and making recommendations to the Board on the C

317、ompany s capital management strategy and the Company s funding requirements and specifi c funding proposals;formulating and monitoring compliance with treasury policies and practices;and the management of credit,liquidity and commodity market risks.Santos Annual Report 200933PART 4:RISK MANAGEMENT4.

318、1 Risk management systemsThe Board is responsible for overseeing the implementation of,and ensuring there are adequate policies in relation to,the Company s risk management and internal compliance and control systems.These systems require Management to be responsible for identifying and managing the

319、 Company s material business risks,which include fi nancial and non-fi nancial risks,such as environmental,exploration and investment risks.An Enterprise-Wide Risk Management approach forms the cornerstone of Risk Management activities of the Company,which has been based on the relevant Australian S

320、tandard(AS/NZS 4360:2004).This approach is incorporated in the Company s Risk Management Policy and aims to ensure that material business risks(both fi nancial and non-fi nancial)facing the Company are consistently identifi ed,analysed and evaluated,and that active management plans and controls are

321、in place for the ongoing management of these risks.Independent validation of controls is undertaken by internal audit as part of its risk-based approach.The internal audit function is independent of the external auditor and reports to the Audit Committee.4.2 Management reporting on riskManagement re

322、porting on risk operates on a number of levels.All reports to the Board on strategic and operational issues incorporate an assessment by Management of the associated risks,which ensures that the Board is in a position to make fully-informed business judgements on these issues.In addition,the Board r

323、eceives dedicated risk management updates from management,which address the material business risks facing the Company and the systems and policies in place to manage those risks.In addition to these periodic updates,the Board and Management give consideration to effectiveness of the Company s risk

324、management and internal compliance and control systems,and whether there is scope for further improvement of these systems.The Board confi rms that it has received a report from management as to the effectiveness of the Company s management of its material business risks for the 2009 Financial Year.

325、The Board also receives written certifi cations from the CEO and the CFO in relation to the Company s fi nancial reporting processes.For the 2009 fi nancial year,the CEO and CFO certifi ed that:“The declaration provided in accordance with section 295A of the Corporations Act in respect of the Consol

326、idated Financial Report for the year ended 31 December 2009 is founded on a sound system of risk management and internal control,and the system is operating effectively in all material respects in relation to fi nancial reporting risks.”Relevant policies and chartersSee Board Guidelines Risk Managem

327、ent PolicySantos Annual Report 200934Corporate governance(continued)4.3 Examples of business risksExamples of management of specifi c business risks,and the systems Santos has in place to manage these risks,include the following:Type of riskMethod of managementEnvironmental and safety riskEnvironmen

328、tal and safety risk is managed through:a comprehensive Environmental Health and Safety Management System based on Australian Standard 4801 and International Standard 14001;environment,health,safety and sustainability committees at Board and management levels;the retention of specialist environmental

329、,health and safety staff and advisors;regular internal and external environmental,health and safety audits and reviews,including process safety reviews;regular training of employees with respect to environment,health and safety;and imposing environmental care and health and safety accountability as

330、line management responsibilities.Exploration and reserves riskExploration risk and uncertainty is managed through:the implementation of risk management processes,including reporting mechanisms in respect of each exploration project;internal control systems which include resource assessment of explor

331、ation prospects,resource development plans and project assurance processes;corporate review in both prospect and hindsight;and Board approval of exploration budgets.The Company has a Reserves Management System that is consistent with the Society of Petroleum Engineers Petroleum Resources Management

332、System.External reserves reviews and audits are also undertaken as necessary.Investment riskThe Company has clearly defi ned procedures for capital allocation and expenditure.These include:a portfolio management system;annual budgets approved by the Board;short and long term funding strategies in re

333、spect of each exploration project which are approved by the Finance Committee;detailed appraisal and review procedures,including the appointment of independent advisers;project management processes,including cost reporting,project forecasts and monitoring of impacts on projects;levels of authority;and due diligence requirements where assets are being acquired.Financial reporting and treasury A com