The company reported an underlying profit of $258 million for the first six months of 2014, attributing the 3% increase on the previous corresponding period to the start-up of operations in PNG.
The company's net profit for the period, however, was down 24% to $206 million, due to non-cash impairments at its Indonesian CSG assets.
Receipt of first cash from PNG LNG prompted Santos to announce a 33% increase in the interim dividend to 20c per share fully franked.
"The first half of 2014 saw Santos achieve its highest oil production in six years, record sales revenue and strong operating cash flow," Santos CEO David Knox said.
"We have set the foundation for a stronger second half.
"PNG LNG is producing at full capacity and Gladstone LNG is more than 85% complete and on track to start up next year, within budget.
"We remain focused on growing shareholder returns as the company's earnings and cash flows increase."
The company's sale revenue grew by 25% to a first-half record of $1.9 billion on the back of a 2% rise to 25 million barrels of oil equivalent from the 2013 period and higher oil and gas prices.
Guidance for 2014 remains at 52-57MMboe, with growing production performance expected from PNG.
The company suffered higher production costs over the last six months, mainly due to new production from its Fletcher Finucane and PNG LNG projects, as well as planned maintenance in the Cooper Basin.
Operating cash flow for the period was up 18% to another first-half record of $744 million, while the company ended June with $2.7 billion in funding capacity, including 400 million cash and $2.3 billion in undrawn committed debt facilities.
The completion record for major projects over the six months to June 30 was 50:50, with Peluang in Indonesia joining PNG LNG on the delivered list, while Dua in Vietnam and the Gladstone LNG project were in the works.
However, Dua has since produced first oil, on July 11, while GLNG expects the last module for its second train to arrive onsite in September.
Meanwhile, the local market was set for a positive start after another solid session of trading on Wall Street.
Singapore Tapis crude closed at $US103.38 a barrel overnight, compared to $104.97 at the end of last week.
The positive conditions were bad news for gold, which fell even further as the outlook for higher US interest rates reduced the metal's appeal as an alternative investment.
Gold futures were last trading at $1278.74 an ounce on the Comex in New York, while silver and platinum also declined.
Base metals in London were mostly lower, with the nickel spot price down 0.6% to $18,746 a tonne and tin falling 1% to $22,156/t.
Zinc and copper both inched higher, while lead fell 0.3% to $2255/t.