Ann: Investor Update, page-34

It is a very long and winding road but the destination is known albeit a long way off. I'd love to be a fly on the wall at STO directors' and management meetings. There really is a long lineup of long term profitable projects with Dorado/Apus in the lineup. Having a bit of Santos as well gives me access to 100% of this project. Hopefully with delays in Barossa it may allow D/A to slip into contention although the CAPEX issue may not be resolved for a while.

As an aside the OPEC+ decision to reduce output by 2m bbls pd was a real surprise although it can be argued they were not meeting their previous targets due to production issues. Combined with a lack of exploration over years, the possibility of a long term decline in US output, and the Russian debacle I think a long term structurally high POO may be here for a while. However a global recession particularly in China and US may negate this. Then again OPEC+ can always adjust output again. Another pandemic like COVID is a black swan.

IMHO the Russians have really shot themselves in the foot or maybe even chopped it off. They are a significant producer but who is going to buy its oil and gas? No-one in the western world and even China would be wary of building pipelines and becoming dependent on it much as Europe did. Angela Merkel thought Russia could be brought into the tent. How wrong she was but it is just Putin to blame for this. So whilst production may still remain there is likely to be structural market issues with shortages in the west and unsold oil in Russia. A fascinating situation that may not be resolved anytime soon. I'm guilty of talking my book that that's my view.