By: Creamer media

Its shares rose 1% in early trading after extending the due diligence period to September 19 to give the consortium led by ADNOC's investment arm XRG more time to secure required internal approvals before making a binding takeover offer.

Santos said the consortium had on Sunday "again confirmed it has not found anything in due diligence that would lead it to withdraw its indicative proposal".

Analysts said the shares would likely be supported on Monday by confirmation the deal was still progressing despite the delays.

The company reported its first-half underlying earnings fell to $508-million from $654-million a year earlier, hurt by weaker realised prices for its liquefied natural gas (LNG) and oil. The result was 3% above Visible Alpha forecast consensus.

While Santos shares rose to A$7.81 per share in early trading after the two announcements, they remain more than a dollar below the consortium's proposed offer of A$8.89 apiece. The gain outpaced a 0.75% rise in the broader S&P/ASX200 index.

Santos last week flagged the consortium, which includes Abu Dhabi Development Holding Company (ADQ) and private equity firm Carlyle, would face a delay in finalising the offer for at least a month.

The deadline for the exclusive talks between Santos and the consortium expired last Friday. Santos can engage with a bidder if a higher offer is made, but is prevented from talks with any parties who match the XRG offer.

The proposed offer requires approval from regulators in Australia, Papua New Guinea, and the US given Santos holds assets in each of those jurisdictions.