Jemena

do we think that this apparent extension to the NGP will be a Plus for CTP?


extract only
AFR today

Jemena moves to bring more gas into the domestic market

Energy company Jemena has signed a deal with Galilee Energy Limited to fast-track bringing new gas into the east coast market via its expanded Northern Gas Pipeline.
With on-going concerns about a potential gas shortfall in the east coast from next year, Jemena is hoping the new pipeline and gas deal with help resolve the supply shortfall which the Australian Energy Market Operator said would hit in 2018 and 2019.

Jemena started construction on the $800 million Northern Gas Pipeline (NGP) - a 622 kilometre link between Tennant Creek in the Northern Territory to Mount Isa in Western Queensland - in July. The pipeline has the potential to deliver 90-100 terajoules of gas once it is completed in late 2018.

Jemena's executive general manager of corporate development Antoon Boey said the new agreement with Galilee Energy will help Jemena expand the NGP another 1100 kilometres from Mount Isa to Southern Queensland, which has been estimated at over $2 billion.

Importantly, this will potentially deliver an extra 200 terajoules into the east coast market for domestic use.

"The intention is to connect this to the south-east Queensland system from the Galilee Basin. There is a very substantial reserve there. Two hundred terajoules is a significant amount of gas and it's slated for the domestic market," Mr Boey told The Australian Financial Review.
"The simplest way to solve the east coast gas crisis is to develop new sources of domestic supply. Galilee Energy are in the stages of proving up those reserves so how much is commercially convertable is a bit of an unknown, but it's one of the few areas in Australia where there is an expectation there will be substantial production coming out of there."

But Mr Boey  said there were 2500 petajoules of undeveloped gas reserves which could end up delivering up to 200 terajoules a day for 20 years. This would supplement the 90 to 100 terajoules a day flowing from the NGP.

Galilee Energy managing director Pater Lansom said they were hoping to convert the 4000 square kilometre tenement - which is one of the largest uncontracted contingent gas reserves on the east coast - into a new gas source.

"This partnership is all about working together to get this critical gas supply option to the domestic market as quickly as possible," Mr Lansom said.