increase shareholder value so 
I am pleased to be able to report
that in 2004, Santos drilled 16
wildcat wells resulting in seven
hydrocarbon discoveries.
Growing our oil and gas reserves
for future production is the goal
of our exploration efforts. On 
a rolling three-year average we
have replaced the hydrocarbons
that Santos has produced at 
a rate of 130% of Proven (1P)
reserves, at an average
replacement cost of around 
US$7 per boe. 
Santos has an exciting
exploration program for 2005: one
that I believe holds the highest
resource potential of any program
in the Company's 50-year history.
We expect to participate in
drilling a record 157 wells during
2005, of which 25 are exploration
wildcat wells. Consistent with 
the growing internationalisation
of Santos, this includes eight
wells in Indonesia and six wells
in the Gulf of Suez, Egypt. This
program offers an attractive
combination of risk and reward
and is a new focus to our
overseas exploration effort.
In the US, two exploration wells
are planned, one onshore, and
one offshore in the shallow
waters of the Gulf of Mexico.
In Australia, our increasing focus
on the potential of offshore areas
will see Santos drill three wells
off Western Australia in 2005, 
one off southern Australia and
two wells off northern Australia.
We will also drill two wells
onshore in Queensland and one
onshore in Victoria. 
The discovery of oil and gas 
at Hiu Aman in the Kutei Basin,
offshore East Kalimantan, has
provided a strong start to our
2005 exploration program and 
we look forward with anticipation
to further work on that
significant find. Santos has a 
50% interest in the discovery. We
believe this region of Indonesia 
is very promising and Santos
expects to drill four wells in the
Kutei Basin in 2005.
BIGGEST DEVELOPMENT 
YEAR YET
I am pleased also to report 
that 2004 was a record year for
development with six projects
advancing through the pipeline.
The start-up of the Mutineer-
Exeter oil field is a significant
milestone in Santos' development
history. This project off the
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