Santos CEO Kevin Gallagher pockets $4.7m ‘golden handshake’ bonus after flagging job cuts, profit falls
Kevin Gallagher’s pay packet for the 2025 year was inflated by a multimillion-dollar payment of performance rights as the oil and gas producer also announced sweeping job cuts
Santos boss Kevin Gallagher has pocketed a near $5 million bonus as the oil and gas producer flagged 400 job cuts with a weaker-than-expected annual profit.
The Adelaide-based group’s annual report showed Mr Gallagher’s pay packet for the 2025 year was inflated to $9.1m from $5.9m by a $4.7m payment of performance rights under a golden handcuffs agreement deal struck in 2021.
Directors drew up the agreement, characterised as a “CEO growth incentive”, after largely discounted rumours that Woodside Energy was looking at Mr Gallagher as a potential replacement for Peter Coleman, who was ultimately succeeded by Meg O’Neill.
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The annual report disclosed the chief executive met the conditions for the vesting of 90 per cent of the 847,458 Santos performance rights on offer.
The personal windfall came as Santos used its annual results to reveal its plans to further cut costs by jettisoning 10 per cent of its 4000-strong workforce.
Mr Gallagher said that as Santos’ major growth projects were completed, “we are targeting a head count reduction of around 10 per cent, rightsizing the business”.
“Our base business has performed exceptionally well with production maintained and the best unit production costs in a decade, achieved through continued commitment to the disciplined low-cost operating model,” he said.
The results showed a 33 per cent drop in Santos’ full-year profit to $US818m - below analyst expectations - with revenue off 8 per cent at $US4.9 billion as realised oil and LNG prices fell.
“Global energy markets in 2025 remained volatile, driven by persistent geopolitical tensions and a slowdown in economic growth,” Santos chair Keith Spence said.
However, despite short-term uncertainty, demand for coal, oil and gas continued to rise, he said.
Like Woodside, Santos is betting that Asia will help underpin growth in demand for LNG, despite forecasts of a looming supply glut.
“Asia remains at the center of LNG demand growth, with consumption forecast to expand strongly through to 2050. Santos is well positioned with advantaged supply into the region,” Mr Gallagher told a call with analysts on Wednesday.
“It is the only scalable, dispatchable fuel capable of supporting renewables while maintaining grid stability. That makes it a foundation fuel for economies that are growing,” he said.
