Snowcap Research on Thursday released a 62-page presentation accusing Adelaide-based Santos of pursuing growth at the expense of shareholder returns and ignoring the “transition risk” as the world reduces its reliance on fossil fuels.

Snowcap said Santos plans to spend 83 per cent of its operating cash flow over the next three years on capital expenses (capex), “by far the most aggressive growth plan of any major E&P (exploration and production) company globally.”

“As far as we can tell, Santos’ growth ambitions appear to be driven by a series of perverse executive incentives which reward absolute growth, even where it destroys value for shareholders,” Snowcap said.

Snowcap is calling on Santos to reduce its expenses on upstream capex, meaning expenditures related to oil and gas extraction, improve its environmental and safety performance, re-align executive incentives and refresh governance.

In tandem with billionaire Mike Cannon-Brookes, Snowcap last year helped tank the demerger of AGL’s coal-fired power plants, which the utility is now planning to shutter earlier than previously.

Also on Thursday, activist group Market Forces said it was urging shareholders to vote against Santos’ renumeration report “on climate grounds” at the company’s April 6 annual general meeting.

Since Santos recorded a “first strike” last year, if 25 per cent of the shareholders vote against the report next month, it would trigger an automatic “spill motion,” meaning shareholders would vote on whether or not to spill the entire board and make them stand for re-election.

Market Forces said it would put forward a similar resolution against Woodside at that company’s April 28 AGM.

A Santos spokeswoman didn’t immediately return an email seeking comment. In its notice of meeting, Santos noted the activist shareholders seeking to amend the company’s constitution owned just 0.007 per cent of company shares.

In February, Santos reported a 2022 after-tax profit of $3b, up 221 per cent. 

-with AAP