Santos approves high-return Agogo tie-in project to boost PNG LNG output

Santos Limited ( (AU:STO) ) has shared an update.

Santos Limited has approved a final investment decision for the Agogo Production Facility Tie-In Project in Papua New Guinea, connecting the Agogo facility to the PNG LNG gas pipeline via a new 19-kilometre pipeline, two new wells and production modifications. The project, with Santos’ capital share of about $160 million and gross capex of around $400 million over three years, is targeting first gas in the second quarter of 2028 and will use existing PNG LNG infrastructure.

The development is expected to add about 135 mmscf per day of incremental capacity, with Santos’ net share around 54 mmscf per day, supporting a production plateau of roughly 12 years and potential output beyond 2050. With an anticipated internal rate of return above 50 per cent and payback in under four years from investment decision, the project is positioned as highly value accretive, underpinning Santos’ long-term production profile and sustaining feed gas for PNG LNG while key approvals, land access and joint venture consents are already in place.

The most recent analyst rating on (AU:STO) stock is a Buy with a A$8.60 price target. To see the full list of analyst forecasts on Santos Limited stock, see the AU:STO Stock Forecast page.

More about Santos Limited

Santos Limited is an Australia-based energy company focused on exploration, development and production of natural gas and liquids, with significant operations in Papua New Guinea. The company supplies gas to LNG projects and domestic markets, leveraging existing processing and export infrastructure to optimise capital efficiency and long-term output.

YTD Price Performance: 24.50%

Average Trading Volume: 17,319,487

Technical Sentiment Signal: Strong Buy

Current Market Cap: A$24.37B

For detailed information about STO stock, go to TipRanks’ Stock Analysis page.