“Production is expected to continue on free flow, without the assistance of the sub-sea pumps, until such time as replacement parts are available,” the company said on Monday afternoon.

The production impact is expected to be between 0.3 to 0.5 million barrels of oil (gross) in 2007 (Santos share 0.1 to 0.17MMbbl). In the event that repairs are completed by April, an impact of between 0.5 to 1MMbbl (gross) is expected in 2008 (Santos share 0.17 to 0.34MMbbl).

Santos will give a further update on the situation and its production and cost impact in the company’s next quarterly activities report which will be lodged with the ASX on January 24.

Interests in the Mutineer-Exeter fields are: Santos (operator) 33.4%, Kufpec 33.4%, Nippon Oil 25% and Woodside 8.2%.