MELBOURNE, Aug 19 (Reuters) - Australian oil and gas producer Santos Ltd STO.AX slid to a loss in the first half of 2016, hurt by a drop in oil prices and a heavy debt load, but said it had cut production costs by 15 percent.
After a horror year last year, just as it started exporting liquefied natural gas from its $18.5 billion Gladstone LNG project, its new boss said on Friday the company was on track to slash costs to be breakeven at an oil price of $43.50 a barrel this year.
"But there is still a lot of work ahead of us," Chief Executive Kevin Gallagher said in a statement.
Santos reported a loss of $5 million before one-offs for the six months to June, down from an underlying profit of $25 million a year ago. That compares with five analysts' forecasts that ranged between a loss of $95 million and a profit of $13 million.
At the bottom line, it slid to a net loss of $1.1 billion, after booking a $1 billion writedown on Gladstone LNG, which it flagged on Monday. The project has been squeezed by a weaker outlook for LNG, having to rely on gas from other companies to help feed the plant and higher costs for that gas. debt fell to $4.5 billion as of June from $6.7 billion a year earlier.
Santos paid no interim dividend. At least two analysts had expected a dividend of around 4 cents a share.