Santos Signs Korean Supply Deal and Takes Ksi Lisims Offtake in Twin HOA Move
Back-to-back preliminary agreements from Tuesday extend Santos's Asian LNG book and add a third international offtake anchor for Canada's $30-billion Ksi Lisims project.
Santos Ltd signed two preliminary LNG agreements on Tuesday (2026-09-15): a heads of agreement to supply liquefied natural gas to a South Korean industrial customer, and a separate HOA to offtake volumes from the proposed Ksi Lisims LNG project in British Columbia for resale into Asian markets, Rigzone reported.6
South Korea already absorbs a share of Australian LNG under existing long-term contracts, and JKM Asian LNG stood at $27.76 per MMBtu on Wednesday (2026-09-16). No financial terms for the Korean HOA were disclosed. The deal adds a new demand anchor to Santos's Asian trading book, with the South Korean counterparty described only as an industrial customer.6,2
The Ksi Lisims offtake deal ties Santos to a project that has not yet taken a final investment decision. The British Columbia terminal is a $30-billion development counting the Nisga'a Nation as a key partner, with targeted capacity of 12 million tonnes per annum, which would make it Canada's second-largest LNG export facility. A statement from the project on Tuesday (2026-09-15) described the Santos agreement as its third international offtake deal.7
Two earlier Ksi Lisims agreements had already been signed on the European side. German state-owned energy firm SEFE agreed in late May (2026-05-28) to purchase 1 million tonnes per annum for 20 years, in what was described at the time as Canada's first long-term LNG supply deal with a European buyer, gasworld reported. An FID on the overall project is targeted for the end of 2026.3
Whether German buyers ultimately receive Canadian molecules is not straightforward. Cargo swaps, where a seller delivers to a nearer counterparty while another party handles physical delivery to the nominally agreed destination, are increasingly common in LNG markets, oilprice.com noted in June (2026-06-10). Geography favours Pacific routing over Atlantic delivery, so European offtake commitments from Ksi Lisims may in practice settle through swaps with Atlantic Basin supply chains. At €80.08/MWh for ICE Endex TTF front-month gas as of Tuesday (2026-09-15), the economics of diverting Canadian LNG toward European demand remain intact.4
Santos's role in the Ksi Lisims transaction is that of a trading intermediary, not a project developer. In an investor briefing in Sydney on Tuesday (2026-05-26), Santos said its direct LNG development focus would be on Alaska, Papua New Guinea, and the Beetaloo and Bedout basins in Australia, gasworld reported. Ksi Lisims sits outside that development portfolio; Santos is buying offtake from it to redistribute into Asian markets.2
On Papua LNG, Santos has been adding to its position. Earlier in September (2026-09-07), the company increased its stake in the Papua LNG development as part of a restructuring that will see ExxonMobil take over operatorship from TotalEnergies, oilprice.com reported. Papua LNG, combined with the Ksi Lisims offtake, forms part of an effort to build diversified LNG supply into Asian markets from multiple origins.5
Australia's existing LNG export base remains heavily contracted. Up to 83% of Australian LNG output is pre-allocated through strict long-term supply agreements, mostly serving Japan, China, South Korea, and Taiwan, according to analysis cited by gasworld. New offtake arrangements like the Ksi Lisims HOA expand Santos's trading book but do not displace the underlying contracted position.2
Santos shares were quoted at about A$7.89 in early May 2026, up roughly 28.3% year-to-date at that point, according to market data compiled by Simply Wall St, reflecting investor interest in the company's LNG positioning.1
Ksi Lisims now has three signed international offtake agreements and an FID target of end-2026. But a $30-billion project in British Columbia still requires financing closure, regulatory clearances, and final commercial alignment before any cargo moves, and HOAs carry no obligation to build. The Santos agreement adds to the commercial case for FID but does not complete it.7,3