Santos’ Strategic Projects team
focuses on assets that have
proven difficult to commercialise
or that need to be considered 
in a regional context rather than
on an individual basis.
The other key activity for this
team has been to lead Santos’
continuous improvement focus.
UNITED STATES GAS
The US gas business was a major
focus in 2004 for a number of
reasons, not the least of which
are the higher gas prices in the
US compared with the domestic
Australian market, and the ability
to rapidly commercialise new
discoveries. 
An ongoing development and
delineation program was carried
out during the year, yielding
better than planned production.
The exploration initiative also
continued to seek higher risk 
but more material prospects, 
aimed at enhancing the move
into the shallow water area of 
the Gulf of Mexico. Exploration
results in this area during 2005
will shape Santos’ future strategy
in the US.
TIGHT GAS
Hydrocarbons contained in traps
with poor permeability are known
as ‘tight gas’ . Large tight gas
resources are known to exist in
the Cooper Basin. Under current
circumstances, this gas cannot 
be economically developed but,
with the combination of improved
production techniques and better
commercial terms, could prove
attractive. 
Santos assessed the resources 
and potential technologies that
could be applied to unlock these
resources during 2004 and is now
working up a range of possible
evaluation projects to be
undertaken in 2005.
NORTHERN AUSTRALIA GAS
Santos has a significant existing
gas resource base and some
promising exploration acreage 
in the waters offshore Darwin,
where it intends to drill a gas
exploration well later this year.
The Company currently operates
the Mereenie gas field in the
Amadeus Basin in central
Australia, which supplies gas to
Darwin. Santos’ first offshore gas
production in northern Australia
begins in 2006, sending Bayu-
Undan gas to Darwin for
conversion to LNG. Santos plans
to build upon its growing
position in the region to target
further development which could
ensure long-term gas supplies 
for the current market, or an
expanded Northern Territory
domestic market, or for export.
PAPUA NEW GUINEA GAS
Santos is in active discussions
with the PNG Gas Project
participants to potentially 
re-enter the PNG Gas Project.
Santos has a significant interest
in a large part of the liquids-rich
Hides gas field which is integral
to the development of 
the Project.
Annual Report 200422
‘Our objective is to derive value
from undeveloped assets which
have been outside of Santos’
base business. ’
BRUCE WOOD 
Vice President 
Strategic Projects
Managing Options
UNLOCKING THE VALUE OF STRATEGIC ASSETS
2004 CONTINGENT RESOURCES
(TOTAL 1,443 mmboe)
Northern Australia 
709 mmboe
Western Australia 
71 mmboe
Central Australia 
240 mmboe
Southern Australia 
32 mmboe
Papua New Guinea 
391 mmboe
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