"The $7.7 billion Gladstone LNG project augments our leadership position in the domestic Australian gas market," Knox told the company's annual general meeting in Adelaide on Friday.

"We have first mover advantage and will be the first company in the world to convert coal seam gas to LNG and market the gas to Asia."

This is an interesting claim, given that the three other consortiums planning Queensland CSM-LNG projects are all targeting earlier start-up dates than Santos.

Knox said the company's search for a partner for GLNG project had attracted significant interest from major LNG players, and the company had commissioned parallel pre-front end engineering design studies to identify the best technology for the project.

"We expect to be able to announce the outcome of our review before the end of the year," he said.

"The project has made significant progress and is on schedule to begin exporting LNG in 2014."

He was also bullish about the potential of the company's CSM assets in eastern Australia, saying that Santos is in a strong position to benefit from move from coal-fired power generation to gas-fired power generation as concerns grow over carbon emissions and water use.

"Our base eastern Australia gas business provides a sound platform for growth," Knox said.

"In the immediate term, we are expanding production at Fairview with the Phase 2 expansion, which will increase gross production to 115 terajoules per day by early next year."

In Western Australia, Knox said Santos is capitalising on the increase in domestic gas prices due to falling supply with the development of the Reindeer gas project in the offshore Carnarvon Basin.

Knox added that production at the Oyong field in Indonesia continued in line with expectations at 8000 barrels of oil per day and has also made good progress with the Chim Sao and Dua oil discoveries in Vietnam.

"We are working closely with our partners towards project sanction this year. We are currently drilling an appraisal well on the Chim Sao field and expect to announce the results in the near term," he said.

Speaking before Knox, Santos chairman Stephen Gerlach said while the company's production outlook for 2008 was between 56-58 million barrels of oil equivalent, the next few years looked much stronger.

"We look forward to a return to production growth in 2009 as volume gains from development projects such as Henry in Victoria and Oyong Phase 2 in Indonesia add to our production."

He added Santos' suite of LNG projects and exploration opportunities in the Browse Basin and Indonesia will transform the company through significant volume growth and margin expansion.

Santos produced 59.1 million barrels of oil equivalent in 2007, slightly lower than record production of 61MMboe in 2006.

However, the company's proved and probable reserves increased for the fourth year straight by 7% to 879MMboe, enough for about 15 years of production at current rates.

Revenue for 2007 was 10% lower than 2006 due to a decline in high margin oil production while net profit was down 32% to $441 million due to accounting adjustments and one-off expenses.