Santos (ASX:STO) share price rises on production update

The Santos Ltd (ASX:STO) share price is edging higher this morning as the company adds a further 10,000 barrels per day in production.

| More on:
Two fountains of black oil in the shape of up arrows signalling oil price rise

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

sdf

The Santos Ltd (ASX: STO) share price is on the rise in early trade after a production update from the Aussie oil and gas giant this morning. At the time of writing, the Santos share price has edged 0.99% higher to $7.15.

Let's take a look at what the company announced.

What's driving the Santos share price?

Santos provided an update on production at its Ningaloo Vision floating production storage and offloading vessel (Ningaloo Vision). This comes after scheduled vessel maintenance in Singapore.

Ningaloo Vision, which ties together several oil fields off the Western Australian coast, has now ramped-up production again. The offshore vessel is expected to achieve production of 10,000 barrels per day in the coming weeks.

Santos managing director and CEO Kevin Gallagher said the vessel's return to production sets the company up for the next stage of production from the Van Gogh oil field. Santos has a 52.5% interest in the Van Gogh-Coniston-Navara project with the remaining 47.5% held by Inpex.

How has Santos performed recently?

The Santos share price has surged higher in the last 12 months after a large share price collapse in March 2020.

Oil prices plummeted last year as the coronavirus pandemic took hold. Demand for energy collapsed as widespread border closures and localised lockdowns reduced usage in key industries like travel and manufacturing.

That saw the Santos share price plummet lower, which somewhat skews the story of the company's recent performance.

Foolish takeaway

The Santos share price is responding positively after today's update from Ningaloo Vision, with the vessel expected to add 10,000 barrels per day.

According to Bloomberg, however, overnight the WTI and Brent crude oil prices fell 4.4% and 4% lower, respectively. WTI closed at US$58.49 per barrel while the Brent crude oil price fell to US$61.82 per barrel. This could be subduing the impact on the company's share price of its positive update today.

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Business man at desk looking out window with his arms behind his head at a view of the city and stock trends overlay.
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave buy ratings to these ASX shares last week. Why are they bullish?

Read more »

A Santos oil and gas worker wearing a hard hat stands in a yellow field looking at blueprints with an oil rig and blue sky in the background
Share Market News

Energy shares rip amid Middle East tensions while ASX 200 surges 20% from April low

ASX energy shares roared 6.49% higher while the ASX 200 lifted 0.37% and set a new record last week.

Read more »

A young man wearing a black and white striped t-shirt looks surprised.
Broker Notes

These ASX 200 shares could rise 25% to 80%

Analysts think big returns could be on offer from these shares.

Read more »

The silhouettes of ten people holding hands with their arms raised against the sky, as the sun rises or sets in the background.
Share Gainers

Here are the top 10 ASX 200 shares today

Investors were nervous this Friday, ending the week on a sour note.

Read more »

A businessman looking at his digital tablet or strategy planning in hotel conference lobby. He is happy at achieving financial goals.
Share Market News

Where to invest $5,000 into ASX 200 shares this month

The team at Bell Potter is bullish on these names. But why?

Read more »

Man pointing an upward line on a bar graph symbolising a rising share price.
52-Week Highs

8 ASX 200 shares hitting multi-year highs today

These shares have defied the trend, hitting new price milestones amid a day in the red for the ASX 200.

Read more »

Broker Notes

Brokers name 3 ASX shares to buy today

Here's why brokers are feeling bullish about these three shares this week.

Read more »

A young man punches the air in delight as he reacts to great news on his mobile phone.
Share Gainers

Why EOS, Evolution Mining, Renascor, and Woodside shares are jumping today

These shares are ending the week on a high. But why?

Read more »