From todays afr. A merged Santos-Oil Search would be likely to embark on asset sales including Oil Search’s Alaskan oil interests and could slim down its beefed-up portfolio in Papua New Guinea, analysts say.But any divestments would be from a position of strength, given the more robust balance sheet the combined company would have compared to Oil Search on its own.“At current commodity prices, the combined entity will generate significant free cash flow through 2021 and 2022,” Wood Mackenzie research director Andrew Harwood said in the wake of Monday’s news that the two have broadly agreed terms for a merger.“A stronger balance sheet will then provide a solid platform from which to invest in new development projects in Australia and PNG. Capital reallocation within a larger portfolio, or strategic divestments, would be likely to smooth out future outflows.”
could coi provide some of those new development projects?
COI Price at posting:
9.1¢ Sentiment: None Disclosure: Held
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