A commitment by Santos to prioritise returns to shareholders over investing in higher oil and gas output has been met with a mixed reception from the market amid doubts that a revision to its dividend policy will actually translate to higher payouts.

The energy producer, which has been facing pressure from some institutional investors dissatisfied with its performance, said that after its next two new projects came online, it would aim to reward investors with 60 per cent of “all-in” free cash flow.