Santos CEO gets incentive to deliver key projects, energy transition
Australian energy giant Santos has decided to provide the company’s managing director and chief executive officer (CEO) with a one-off growth projects incentive to ensure successful delivery of Santos’ major growth projects and energy transition strategy to 2025.
Santos said on Monday that the company’s share price more than doubled during the tenure of CEO Kevin Gallagher’s tenure, generating a total shareholder return of 159 per cent including dividends, compared to 83 per cent for the ASX 200 Index and 37 per cent for the ASX Energy Index.
According to the company, since joining Santos in February 2016, Gallagher made Santos a sustainable and resilient business that generates significant free cash flow.
“Central to the turnaround has been the clear and consistent Transform-Build-Grow strategy and the disciplined, low-cost operating model”, the energy firm said.
Santos stated that it was now moving into a growth phase consistent with the company’s strategy for disciplined growth utilising existing infrastructure around the company’s core assets.
Major growth projects include Barossa, Dorado, and Moomba carbon capture and storage. Santos is also leading the energy transition to cleaner fuels and has a clear roadmap to achieve its target of net-zero emissions by 2040.
Santos chairman Keith Spence said: “Kevin is critical to the successful delivery of the company’s strategy, major growth projects and driving the energy transition over the next five years”.
Kevin Gallagher added: “It is a privilege to lead Santos. We have made significant progress on our transformation journey, but the job is not yet done. I am delighted to commit to continuing to drive the delivery of our growth strategy, the transition to a leading clean fuels business and to achieve our net-zero emissions targets”.
The growth projects incentive will be delivered in the form of share acquisition rights (SARs) with a face value at a grant of A$6 million or around $4,5 million. Vesting of the SARs will be subject to strict performance hurdles related to the successful delivery of major growth projects, the energy transition strategy, and continued employment.