Santos Ltd will proceed with its $2.6 billion Alaskan oil project, the Australian energy producer said on Wednesday after posting a four-fold jump in first-half profit buoyed by surging liquefied natural gas (LNG) prices.
The country's No. 2 independent gas producer increased its planned on-market share buyback to $350 million from $250 million and said it was in advanced talks with shortlisted parties to sell a 5% stake in its Papua New Guinea LNG plant.
Western countries have imposed sanctions on exports from major gas producer Russia, sending LNG prices to record highs and boosting the earnings of producers such as Santos.
The price surge has also put Australia on track for record revenue from LNG, the country's second-largest export, in the year to June 2023.
Santos said it would pay $1.3 billion for the development of its Pikka joint venture in Alaska, forecasting a 19% internal rate of return at a $60 per barrel oil price.
The company - which became a global top-20 oil and gas firm after its $6.2 billion buyout of Oil Search last year - increased its interim dividend by nearly 38% to 7.6 cents per share.
Underlying net profit was $1.27 billion for the half year ended June 30, compared with $317 million a year earlier.