MOU for major gas project
New pipeline could take Moranbah gas all the way to Victoria
Wednesday 21 June 2017
Gas pipeline infrastructure group APA has entered into a non-binding Memorandum of Understanding (MOU) with Bowen Basin gas explorer Blue Energy which could see the construction of a major new gas project in Central Queensland.
Under the MOU, APA Group will do a feasibility study to examine how gas extracted from Blue Energy’s Bowen Basin gas reserves could be piped to Southern Australia where businesses are currently experiencing energy shortages and high power prices.
The feasibility study will work on a business model where APA builds, owns and operates all the gas field infrastructure and required pipelines to commercialise the Bowen Basin gas reserves.
While it could be years before anything of consequence happened on the ground, Blue Energy Managing Director, Mr John Phillips, anticipates further successful negotiation with APA Group will yield detailed design and preferred route options.
“With the successful conclusion of these steps, project approval, and Final Investment Decision, APA will become the builder, owner and operator of the new infrastructure,” he said.
Last year APA signed a similar agreement with gas explorer Comet Ridge last year to connect that company’s gas resources in the nearby Galilee Basin to its east coast grid.
Gas production from the Bowen Basin into the Moranbah and Townsville markets commenced in 2005 and since that time the province has produced approximately 160 PJ of gas and at production rates as high as 40 Tj/day.
In March this year, APA lodged paperwork with the Federal Environment Department for the construction of a fifty-kilometre pipeline from the APLNG Reedy Creek CSG processing facility to the Wallumbilla gas hub roughly 40 kilometres East of Roma.