Santos in restart mode for Dorado stake sale

Woodside merger talks stalled the sale process for Dorado.

Speculation is mounting that Santos is preparing to relaunch its sale process for its stake in the Dorado oil and gas project off the coast of Western Australia.

Last year, Santos had investment bank Goldman Sachs assessing suitable offers for the interest in the project that it jointly owns with Carnarvon Energy.

However, that process, along with other options such as a selldown of its Alaskan assets, were paused as it entered talks with rival Woodside about a merger.

Now it is expected to restart the process as it looks to maximise the value of its assets after the Woodside merger did not proceed.

Two parties are also now assessing a purchase of part of the Santos stake in the Pikka oil project in Alaska that the company inherited from its $21bn merger with Oil Search in 2021.

As reported by DataRoom in August, Taiwan’s state-owned petroleum company, CPC Corporation, at that time was seen as the most likely buyer of an additional stake in Dorado.

Other possible suitors were considered to be Kufpec, Mitsui, Mitsubishi, Tokyo Gas, Osaka Gas and Jadestone Energy.

CPC has already bought 10 per cent of Dorado from Carnarvon, the other owner of the project, as well as Carnarvon’s Pavo project for an all-up payment of $US146m.

Santos has an 80 per cent interest in Dorado and the thinking in the market is that it remains keen to reduce that exposure to about 60 per cent.

Dorado, once owned by Woodside Petroleum and later Quadrant Energy before it was purchased by Santos, is an integrated oil and gas project which will be developed in two phases in the Bedout sub-basin, about 140km off the coast of WA’s Port Hedland.

The Dorado and Pavo fields are estimated to contain gross 2C recoverable contingent resources of 189 million barrels of liquids and 401 petajoules of gas.