To this end, further reductions 
in costs for 2005 are targeted 
by increasing the focus on 
fit for purpose rigs and larger
campaigns. These efforts will be
supported by a significant boost
in 3D seismic acquisition that
commenced at the end of 2003
and continues in 2005.
Coiled tubing underbalanced
drilling operations were performed
at three gas wells and one oil
well, while multiple pinpoint
fracture stimulations were
performed at five new gas wells,
with between three and six fracs
performed in each well. 
These introductory programs 
are providing encouraging initial
results. The underbalanced drilling
program achieved better than
predicted rate improvements 
for all three gas wells.
These programs will now be
extended to a variety of more
complex and possibly harsher 
oil and gas wellbore/reservoir
environments during 2005. 
Santos increased gas well
deliverability in the Cooper 
Basin by 63 TJ per day through
numerous projects brought on
line during 2004. Some 8 PJ 
of incremental gas production
resulted during 2004 from this
optimisation program. These
results were achieved at a
significantly lower cost than
conventional development drilling
and substantially exceeded
targets set at the beginning 
of the year.
While the Cooper Basin 
is a mature hydrocarbon area,
Santos is drilling wells which can
be commercialised quickly and
cost-effectively, delivering strong
cash flow which can be applied 
to other growth opportunities. 
A further focus in 2004 was 
to leverage Cooper Basin
infrastructure; for example, via
gas swaps, and increase prices
under existing agreements. 
An increased Gas Sales Agreement
was reached with CS Energy which
resulted in an additional seven
wells being drilled at the Scotia
coal seam methane gas field in
eastern Queensland.
Leveraging Base Business
HARNESSING VALUE FROM OPERATIONS
SAN165 WWW Text  30/3/05  12:06 PM  Page 12