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              [html]<thead><tr><td>MALE0 NEGOTIATIONSADVANCED</td><td>subsidiary, Santos Direct Pty Ltd (‘ Santos Direct ’).</td><td>higher volumes of crude oil that Santos will receive from</td></tr></thead><tbody><tr><td>0utside Australia, Santos and its co - venturers have executed a Heads of Agreement for the sale of the entire gas reserves of the Maleo field offshore East</td><td>Santos Direct will market Santos ' 10 % share of gas production from the Minerva field – around 15 T2 / d – in the offshore 0tway Prois</td><td>projects, coming on stream in 2005, and the increasing globalisation of the liquids marketplace.</td></tr><tr><td>Java, Indonesia, Santos continued negotiations with PT Perusahaan Gas Negara, Indonesia ’ s state - owned gas distributor, on behalf of the joint venture to finalise the Gas Sales Agreement. The project is targeting first</td><td>proalsistin as ure end or association as The move to market and sell gas directly into the Wictorian retail market is a first for Santos and leverages off Santos ' position as one of Australia ' s largest gas</td><td>The validity of this approach has already been demonstrated by the sale of the first Mutineer - Exeter oil cargo at a premium to Tapis despite a discount for the uncertain delivery date.</td></tr><tr><td>production in the first half of 2006 at rates of up to 100 mmcf / d for more than five years.</td><td>producers, supplying wholesale gas to major industrial customers and specialist marketers in all.</td><td>Santos continues to build an inventory of high quality options to provide a platform</td></tr><tr><td>FIRST RETAIL GAS SALES WITH SANTOS DIRECT</td><td>territones.</td><td>the coming years. Santos 1s committed to a program of</td></tr><tr><td>As well as selling gas into the wholesale gas market, Santos</td><td>LTQUIDS MARKETING ALLLIANCE WITH BP</td><td>secured a retail. gas licence from the Victorian Government in 2004. This allows Santos to sell.</td></tr><tr><td>Another important marketing development during the year was the decision to outsource the</td><td>legacy asset. Most importantly, this involves leveraging the strengths of the core</td><td>gas direct to industrial customer and into the Victorian spot</td></tr></tbody>
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