SANTOS has recorded a net loss of $2.7 billion for the 2015 calendar year, following after tax impairments worth $2.8 billion, which the company says reflects the low oil price environment.

Most of the impairments, which totalled $3.9 billion before tax, was recorded against the company’s gas producing assets in the Cooper basin and its assets at the Gladstone LNG (GLNG) project and the Gunnedah basin.

Without the impairments, Santos recorded an underlying net profit after tax of $50 million, 91 per cent lower than the 2014 calendar year, when the company recorded a loss of $935 million.

A 20% fall in sales revenue to $3.2 billion in 2015 was largely due to lower average oil prices, with LNG sales revenue being up over 40% following the startup of GLNG and strong performance from the PNG LNG and the Darwin LNG projects.

Santos produced 57.7 million barrels of oil equivalent in 2015, up 7% on the previous year, but total product sales revenue fell 20% to $3.2 billion.

Company chairman Peter Coates said Santos had performed well in 2015 in spite of the lower prices, having delivered its highest production in seven years with the new projects now on line.

“The actions the company took in 2015 to strengthen its balance sheet and lower its cost base have put Santos in a stronger position to manage through a period of low oil prices,” he said.

“The company raised $3.5 billion, reduced capital expenditure by 54% below 2014 levels and lowered production costs per barrel by 10%. With $4.8 billion in cash and committed undrawn debt facilities and no material drawn debt maturities until 2019, Santos is well placed to deal with the short term challenges,” Mr Coates said.

In an announcement, chief executive Kevin Gallagher said he was confident Santos’s broad asset portfolio would give it a platform to deliver stable returns.

“My priority now is to assess our operations and put in place the right strategy to ensure that Santos is sustainable in a low oil price environment, while positioning the company to take full advantage of rising commodity prices in the future,” he said.

Santos kept its production guidance for 2016 at between 57 million and 63 million barrels of oil equivalent, and its sales guidance at between 76 million and 83 million barrels, while its capital expenditure guidance was cut to $1.1 billion.