ASX/ Media Release

     24August2017

     Santos2017Half-yearresults

     Underlying profit increased to US$156 million. Net loss of US$506 million, including

     previouslyannouncedUS$689millionafter-taxnetimpairment

     StrongdeliveryoftheSantosturnaround.Costsreduced,salesvolumeguidanceupgraded,

     strongercashflows,freecashflowbreakevenreducedtoUS$33 perbarrelandnetdebt

     reducedtoUS$2.9billion

     ManagingDirectorandChiefExecutiveOfficerKevinGallaghersaidthecompany’shalf-yearresults

     deliveredstrongprogressontheSantosturnaroundstrategy.

     “Wehaveremovedsubstantialcosts,generatedsignificantfreecashflowandreducednetdebt.

     “Our forecast free cash flow breakeven for 2017 sits at US$33 per barrel and we generated

     US$302millioninfreecashflowinthefirsthalf.(1)Thisispleasingprogresstowardsourgoalof

     transformingSantosintoalow-cost,reliableandhighperformancebusinesswithastrongportfolio

     thatcangeneratesignificantfreecashflowinalowoilpriceenvironment,”MrGallaghersaid.

     Excluding the previouslyannounced netimpairment and other significant items,the company

     recordedanunderlyingprofitofUS$156million,asubstantialimprovementontheunderlyingloss

     ofUS$5millioninthecorrespondingperiod.

     “Our focus on moreefficient, lower costoperations has delivered significantimprovements in

     earningsandcashflow.Santos’coreassetportfoliooffivelong-lifenaturalgasassetsnowprovides

     stablebaseproductionforthenextdecade,”MrGallaghersaid.

     “MaterialreductionsindrillingcostsintheCooperBasinandGLNGareunlockingmoregassupply.

     Inthecomingmonths,Santosexpectstoannouncefurtherdomesticsupplycontractstosupportthe

     FederalGovernment’seffortstodeliveraffordableandreliableenergytohouseholdsandindustry.

     “2017salesvolumeguidanceisupgradedto77to82millionbarrelsofoilequivalent, following

     strongvolumesfromthecoreassetsinthefirsthalfandhigherforecastdomesticsalesvolumes.

     “Wearealsofocusedonfuturegrowth,withexplorationandappraisalactivitygrowingaspartof

     ourdisciplinedoperatingmodelanddeliveringsuccessfuloutcomesintheCooperBasin,aswellas

     MurukinPNGandBarossaoffshoreNorthernAustralia.

     “Santosisnowpositionedtodeliverfuturesuccessandprovidesustainableshareholdervalue.”Mr

     Gallaghersaid.

     Consistentwiththecompany’sfocusondebtreduction,theBoardhasdeterminednottopayan

     interimdividend.TheBoardwillcontinuetorevieweachdividenddecisioninlightofthefocuson

     debtreduction.

      (1)Freecashflowbreakevenistheaverageannualoilpricein2017atwhichcashflowsfromoperatingactivities(includinghedging)equalscashflowsfrom

        investingactivities.Forecastmethodologyusescorporateassumptions.Excludesone-offrestructuringandredundancycostsandassetdivestitures.

Mediaenquiries                       Investorenquiries                     SantosLimitedABN80007550923

JoannaVaughan                       AndrewNairn                          GPOBox2455,AdelaideSA5001

+61(0)419111779                    +61881165314/+61(0)437166497      T+61881165000F+61881165131

joanna.vaughan@santos.com              andrew.nairn@santos.com                 www.santos.com

Resultssummary

Sixmonthsended30June                                     2017         2016     Change

Averagerealisedoilprice                        US$/bbl          54.8          42.8     +28%

Productionvolumes                             mmboe          29.5          31.1       -5%

Salesvolumes                                  mmboe          40.1          40.9       -2%

Revenue                                        US$m         1,496         1,205     +24%

EBITDAX(1)                                      US$m           718          491     +46%

Netimpairmentloss                              US$m         (920)       (1,516)

EBIT(1)                                          US$m         (603)       (1,471)

Netprofit/(loss)fortheperiod                     US$m         (506)       (1,104)

+Impairmentlosses                             US$m           689         1,061

+Netgainsonassetsales                       US$m           (51)             4

+Other                                        US$m            24            34

Underlyingprofit/(loss)fortheperiod(1)              US$m           156           (5)  +3,220%

Operatingcashflow                              US$m           662          291    +128%

Capitalexpenditure(2)                             US$m           321          283     +13%

Netdebt                                        US$m         2,928         4,528      -35%

Interimdividendpershare                  Acents/share              -             -          -

(1) EBITDAX(earningsbeforeinterest,tax,depreciation,depletion,exploration,evaluationandimpairment),EBIT(earningsbeforeinterestandtax)andunderlying

  profitarenon-IFRSmeasuresthatarepresentedtoprovideanunderstandingoftheperformanceofSantos’operations.Underlyingprofitexcludestheimpactsof

  assetacquisitions,disposalsandimpairments,aswellasitemsthataresubjecttosignificantvariabilityfromoneperiodtothenext,includingtheeffectsoffair

  valueadjustmentsandfluctuationsinexchangerates.Thenon-IFRSfinancialinformationisunauditedhoweverthenumbershavebeenextractedfromthefinancial

  statementswhichhavebeensubjecttoreviewbythecompany’sauditor.

(2) Excludingcapitalisedinterest.

Santos’portfolioisfocused onfivecore,long-lifenaturalgasassets:CooperBasin,GLNG,PNG,

NorthernAustraliaandWesternAustraliaGas.Other assets(Asia,NSW andWAoil)havebeen

packagedandrunseparatelyforvalueasastandalonebusiness.

Productionfromthecoreassetsincreasedby2%to25.3mmboeinthefirsthalf,primarilydueto

theramp-upofGLNGandstrongerPNGLNGproduction.Coreassetsalesvolumeswereup5%to

36.1mmboe,drivenbytheramp-upofGLNGandhigherWAgasandPNGsalesvolumes,partially

offsetbylowerCooperBasinsales.

Productionand salesvolumes fromotherassetsdecreased to4mmboe duetothesaleofthe

Victorian,MereenieandStagassets.

Totalrevenueincreasedby24%toUS$1.5billionduetohigherLNGsalesvolumesreflectingthe

ramp-upofGLNG and strongperformance fromPNGLNG,combinedwithhigherprices for all

products.Theaveragerealisedoilpricewasup28%toUS$54.79perbarrelandtheaverageLNG

pricewas26%higheratUS$7.21/mmbtu.LNGsalesrevenuewasup44%duetotheramp-upof

GLNGandstrongperformancefromPNGLNG.

Salesvolumeguidancefor2017isupgradedto77to82mmboe(previously75to80mmboe).

                                                                                    Page2of4

RevenueandEBITDAX(1)byasset

Sixmonthsended30June        2017        2016                 2017        2016

                              Revenue     Revenue             EBITDAX     EBITDAX

                            US$million   US$million   Change  US$million   US$million   Change

CooperBasin                        395         353    +12%         157         104    +51%

GLNG                              358         224    +60%         156          65   +140%

PNG                               250         210    +19%         203         165    +23%

NorthernAustralia                    78          71    +10%          45          37    +22%

WAGas                            135          74    +82%         116         126      -8%

OtherAssets                        170         217     -22%         116         103    +13%

Corporate,explorationand            110          56    +96%        (75)        (109)    -31%

inter-segmenteliminations

Total                            1,496       1,205    +24%         718         491    +46%

(1) EBITDAX(earningsbeforeinterest,tax,depreciation,depletion,exploration,evaluationandimpairment)isanon-IFRSmeasurethatispresentedtoprovidean

  understandingoftheperformanceofSantos’operations.Thenon-IFRSfinancialinformationisunauditedhoweverthenumbershavebeenextractedfromthe

  financialstatementswhichhavebeensubjecttoreviewbythecompany’sauditor.

Upstreamproductioncostsdroppedby12%toUS$239million(US$8.08perboe),primarilydueto

costsavingsandefficiencygainsacrossthecoreassetsandthesaleofnon-coreassets.

OtheroperatingcostsincreasedbyUS$19milliontoUS$189million,primarilyduetohigherLNG

plantcostsfollowingthestart-upofGLNGtrain2inMay2016,higherpipelinecapacitycharges,and

higherroyaltyandexcisecostduetohigheraveragecommodityprices.

Highersales revenues andlower costs combinedto deliver anear50% boostin EBITDAXto

US$718millionforthefirsthalf.AllcoreassetsdeliveredhigherEBITDAX,withtheexceptionofWA

Gas,whichbenefitedfromasettlementunderarevisedgassalesagreementinthecorresponding

period.StrengtheningthebalancesheetNetdebtreducedtoUS$2.9billionasat30June2017,downfromUS$3.5billionatthestartoftheyear.Thecompany’sgearingratiowas30%,downfrom33%attheprioryearend.Netdebtwasreducedthroughacombinationfreecashflowsgeneratedbythebusiness,assetsalesandasharepurchaseplanduringthefirsthalf.InMay2017,S&PGlobalRatingsreaffirmedSantos’BBB-creditratingwithstableoutlook.Aspreviouslyannounced,SantosisexercisingitsoptiontoredeemitsEuro1billionSubordinatedNotesonthefirstcalldateinSeptember2017.SantoshasamplecashandliquidityofUS$4.2billiontofundtheredemption.Debtmarketsremain buoyant andopenfor Santos,andthecompanyexpectstoundertakesuitableadditionaldebtfundingatsignificantlylowerinterestcostsinthenear-term.                                                                                    Page3of4Impairmentofassets

As previously announced, the 2017 first-half result includes a net impairment charge of

US$689millionaftertax,primarilyduetoloweroilprices.Impairmentchargeswererecognised

againsttheGLNG(US$867million)andAALassets(US$149million),partiallyoffsetbyapositive

netwrite-backtotheCooperBasinofUS$336million,wherelowerforecastdevelopmentcostsand

higherproductionmorethanoffsettheimpactofloweroilprices.

2017Guidance

2017salesvolumeguidanceis upgradedto77-82 mmboe,whilerecently upgradedproduction

guidanceismaintainedat57-60mmboe.Allguidancefor2017isshowninthetablebelow.

Item                                                     2017Guidance

Production                                                       57-60mmboe

Sales                                                           77-82mmboe

Upstreamproductioncosts(excludingLNGplantcosts)       US$8-8.25/boeproduced

Depreciation,depletion&amortisation(DD&A)expense           US$700-750million

Capitalexpenditure(excludingcapitalisedinterest)               US$700-750million

Ends.                                                                                    Page4of4