The Dorado project delay is concerning for Carnarvon, which is facing shareholder pressure over its valuation. Credit: MR.Zanis/Shutterstock.

Santos has deferred its plans for the Dorado oil and gas project in Western Australia, valued at more than A$3bn ($1.87bn), leading to a sharp decline in partner Carnarvon Energy’s share price.

The announcement caused a 23% fall in Carnarvon’s shares as Santos reconsidered purchasing a production and storage vessel and delayed the commencement of engineering and design work.

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Santos, with an 80% stake in the field, saw a 2.2% drop in its share value. Carnarvon and Taiwan’s state-owned CPC each own 10% of the field.

A spokesperson for Santos told Reuters: “After a detailed assessment of all relevant factors, Santos recommended to the joint venture that the development concept for Dorado be revisited after further evaluation of Bedout Basin resources.”

Santos has reiterated its commitment to prioritising shareholder returns and focusing on its key Barossa and Pikka gas projects for 2025.

Santos CEO Kevin Gallagher had previously emphasised the importance of shareholder value in August 2024 and at a November investor briefing.

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CPC has not yet commented on the development.

The Dorado project’s slowdown is particularly troubling for Carnarvon, which has been under pressure from shareholders regarding its valuation.

Last year, reports indicated that Carnarvon had authorised its bankers to explore potential bids for the company or its assets.

Earlier month, Santos WA Northwest admitted to a condensate spill at the Varanus Island Marine Terminal.

On 20 March 2022, approximately 25,000 litres of condensate leaked from a pipeline due to structural weakening caused by overbending and kinking.

The company was fined $10,000, along with $9,700 in additional costs.