The Santos Ltd (ASX: STO) share price is slightly in the red today following the announcement of a collaboration agreement.
At the time of writing, the energy producer's shares are swapping hands for $6.95 apiece, down 0.4%.
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Unlocking new wealth opportunities
Investors are eyeballing the Santos share price this morning following the company's efforts in unlocking future regional gas resources.
In this morning's release, Santos advised it has entered into a memorandum of understanding (MOU) with Eni.
Established in 1953, Eni is an Italian multinational oil and gas company specialising in developing new energy solutions. Activities range from the exploration and production of hydrocarbons, as well as refining and marketing oil products and biofuels.
The group operates across 68 countries, with more than 30,000 employees worldwide.
Under the MoU, Santos and Eni will collaborate on developing potential opportunities in northern Australia and Timor-Leste. This includes the possibility of sharing infrastructures in gas field developments around Barossa and Evans Shoal, and pipeline to Darwin. In addition, onshore gas processing leading to LNG expansion are also on offer.
Santos stated that the framework will look at options to re-purpose the Bayu-Undan facilities in extending project life. This of course is subject to approval from the Timor-Leste government.
Other areas of cooperation include the development of Petrel and Tern through Blacktip/Yelcherr gas plant facilities.
Management commentary
Santos managing director and CEO Kevin Gallagher welcomed the agreement, saying:
Eni are already a highly valued partner in the Bayu-Undan project and this MoU strengthens our collaboration and cooperation.
CCS opportunities at Bayu-Undan are extremely exciting for Santos and Eni.
A CCS project at Bayu-Undan could provide a new job-creating and revenue-generating industry for Timor-Leste with quality carbon credits increasing in both demand and value internationally.
Santos share price snapshot
The Santos share price has accelerated more than 50% over the past 12 months and is up around 10% year-to-date. The company's shares reached a 52-week high of $7.80 last month, nearing pre-COVID levels of the $8.50 mark.
Santos commands a market capitalisation of roughly $14.5 billion, with close to 2.1 billion shares outstanding.
