Santos Ltd
(ASX:STO) has announced it will develop new gas supplies for the Western Australian domestic market with its partner Apache Energy.
Gas will be developed and produced from the Halyard field, which Santos owns with Apache, with gas from the area expected to supply around 10 per cent of Western Australia’s domestic gas needs from 2012.
Santos has advised that it has sold a 55 per cent stake in its Spar well to Apache for an initial payment of US$31 million, with the potential for payments up to US $85 million.
Santos says it hopes the sale facilitates both the Halyard and Spar developments, for which it will hold 45 per cent equity in both projects.
Apache will hold a 55 per cent stake and operate both fields.
Both companies say they believe there is further potential in the Greater East Spar Area of Western Australia and are planning more drilling of an exploration prospect called Beam later this year.
Santos reported a profit of $434 million in calendar 2009, and last week reported a 94 per lift in first half year profit to $198 million.
