Santos Signs LNG Deal with QET Awaits $18.7 Billion Takeover Bid

Australian natural gas giant Santos has signed a two-year LNG supply agreement with Qatar Energy Trading (QET), amidst a potential $18.7 billion acquisition led by Abu Dhabi National Oil Company (ADNOC). Starting in 2026, Santos will deliver approximately 500,000 tons of LNG annually to QET on a free-on-board (FOB) basis. The supply will come from Santos' diversified LNG asset portfolio, of which 90% of production capacity is already secured under long-term contracts.

Santos revealed that 85% of its contracts for 2025–2029 are linked to oil prices, with an average price equivalent to 14.7% of Brent crude during 2025–2027. CEO Kevin Gallagher highlighted the strategic importance of the agreement, emphasizing strong demand in Asia for high-calorific LNG from projects like Barossa and Papua New Guinea (PNG).

Santos operates the Barossa project, set to begin production later this year, and is a partner in ExxonMobil's PNG LNG project. Its client roster includes Petronas, TotalEnergies, JERA, Sinopec, and Korea Gas Corporation.

Last month, ADNOC spearheaded a takeover bid for Santos via the XRG consortium, which includes Abu Dhabi Development Holding (ADQ) and Carlyle Group. The proposed deal, valued at $18.7 billion, is scheduled for shareholder review, with Santos' board recommending the offer.