Australia's Santos forecasts higher production for fiscal 2026

Jan 22 (Reuters) - Australian oil and gas producer Santos STO.AX forecast higher production for fiscal year 2026 on Thursday, as it ramps up production at its Barossa LNG project and starts producing oil from its Pikka project.

The country's second-largest independent gas producer expects 2026 output between 101 million and 111 million barrels of oil equivalent, compared with its 2025 output of 87.7 mmboe and Visible Alpha's consensus estimate of 108.5 mmboe.

Santos said its Pikka phase 1 project in Alaska was 98% complete at the end of the quarter. The project is on track to produce first oil late in the first quarter of 2026 with an initial oil rate of about 8,000 barrels of oil per day.

The Adelaide-based company said it was focusing on increasing gas production from its Barossa LNG project in Darwin, with the first cargo currently being loaded.

"Once at full rates, Barossa LNG and Pikka phase 1 together are expected to lift Santos' production by around 25 to 30 per cent by 2027 compared to 2024 levels," CEO Kevin Gallagher said in a statement.

Santos also posted a 9% sequential rise in fourth-quarter revenue to $1.23 billion, due to higher LNG and condensate sales volumes. That was largely in line with Visible Alpha's consensus estimate of $1.25 billion.