Fossil fuel giant Santos says it's too soon to say when a final investment decision will be taken on the Narrabri project proposed for farmland and state forest land in NSW.
Chief executive Kevin Gallagher said a number of projects would be competing for capital, including Narrabri, Dorado off the coast of Western Australia, Barossa north of Darwin and Pikka in Alaska.
"We see the demand for gas remaining strong, and in fact potentially growing to 2050 and beyond," he told a webcast on Wednesday.
But Santos shares fell 4.7 per cent to $7.45 in afternoon trade as investors questioned rising production costs and forecasts of multi-billion-dollar free cashflow in coming years.
The oil and gas company reported a 19 per cent fall in net profit to $US636 million ($A943 million) in the six months to June 30 as sales revenue fell nine per cent to $US2.7 billion ($A4.0 billion).
Overall sales volumes eased one per cent to 46.4 million barrels, with lower volumes from Bayu-Undan and the Cooper Basin partly offset by higher gas volumes in WA where 200 workers were laid off.
In WA, where Santos is one of the largest producers of domestic gas but struggles to be cashflow positive, earnings rose six per cent to $US267 million ($A396 million) as production for local use rose 5.2 per cent to 50.4 petajoules.
"In terms of whether something fits or doesn't fit longer-term, we'll make an announcement on that when we make a decision on any asset acquisitions or disposals," Mr Gallagher said.
Woodside Energy and Santos failed to come to terms on an $A80 billion merger in February, and he was coy when quizzed about reports of other suitors, including Saudi's Aramco and Abu Dhabi National Oil Co.
"We talk to other companies all the time ... it wouldn't surprise me if people were looking at Santos, because we have a world-class LNG portfolio," he said.
Progress on Narrabri includes working towards land access agreements, environmental surveys and preliminary works for the Hunter gas pipeline route.
After 14 years, Narrabri is yet to reach the crucial stage for any mega energy project when capital is committed. In contrast, WA's Dorado is expected to be final investment decision-ready in 2025.
"I would never want to be the person predicting when Narrabri is going to take (final investment decision)," Mr Gallagher said.
The National Native Title Tribunal process was "ongoing", the company said, despite traditional owners remaining opposed to the $3.6 billion project.
The Federal Court ruled in March that the tribunal erred when it granted Santos licences for coal seam gas mining for Narrabri, because it failed to take climate change into account.
To the north, the $5.8 billion Barossa gas project is almost 80 per cent complete and on schedule with first gas expected in the third quarter of 2025, after a cultural heritage claim on underwater songlines was thrown out in January.
The Moomba carbon capture and storage project in South Australia will have first injection this year and has capacity to store up to 1.7 million tonnes of carbon dioxide annually.
Santos also has a 30 per cent stake in the massive GLNG project in Gladstone, Queensland, which produces LNG for export as well as selling gas into the domestic market.
"Ultimately the prize for GLNG is to find another field, to find another supply source, and we are working with the partners on options to do that over the medium to longer term," Mr Gallagher said.
