Cooper Energy has signed a gas sales agreement with Energy Australia to supply 5 PJ per annum from the Sole gas field for a minimum of five years, and with provision for a three-year extension.
The agreement is conditional upon completion of the transaction for Cooper to acquire Santos’s Victorian Gas assets announced on 24 October 2016 and an affirmative final investment decision (FID) for Sole.
The acquisition of Santos’ share in Sole will result in Cooper holding a 100% equity in the field, which is assessed to contain contingent resources of 2411 PJ of gas. The agreement with Energy Australia is the fourth signed by Cooper for the field and takes the annual contracted quantity to 14.6 PJ of the 25 PJ annual production anticipated from the field for the first eight years.
The firm anticipates committing up to 85% of the annual volume prior to FID and is currently engaged in discussions with gas buyers on sale agreements for the remaining quantity. The Energy Australia agreement follows agreements with O-I Australia, AGL and Alinta Energy.
Cooper managing director David Maxwell said that the latest agreement is another step in the company’s strategy to build a portfolio of blue-chip gas contracts and a step closer to an affirmative FID for the Sole gas project.
“Our agreement to acquire Santos’ Victorian assets has substantially expanded our gas contracting opportunity and we are delighted to add Energy Australia to our portfolio of gas supply customers,” he said.
“There is keen interest in contracting gas from Sole and we expect to finalize additional off-take contracts within the next few months. The market outlook is positive and, thanks to the strong support and commitments we have received from major energy retailers and industrial users, we are close to finalizing a quality gas contract portfolio ahead of FID for the Sole project.”
Sole FID is expected to occur in the March quarter 2017, with first gas from the project scheduled by March 2019. Supply to Energy Australia under the agreement would commence 1 January 2020.
The Sole gas field is located in VIC/RL3, offshore Victoria approximately 62km from the Orbost Gas Plant, onshore Victoria, where Sole gas will be processed and delivered to the Eastern Gas Pipeline.
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