Jemena has agreed to build, own and operate the Atlas Gas Processing Plant and Pipeline (AGPP), to process and transport natural gas produced from Senex Energy’s Project Atlas in Queensland’s Surat Basin to the Australian domestic market.
AGPP, which will be funded by nearly an A$140m ($104.26m) investment from Jemena, will be made up of a gas processing facility with an initial capacity of 40 terajoules (TJs) and a nearly 60km long pipeline that can transport close to 40TJs of gas per day.
The new pipeline will connect the production from the Atlas gas field to Jemena’s Darling Downs Pipeline and the Wallumbilla Gas Hub.
According to Jemena managing director Paul Adams, the AGPP will consolidate on the company’s Northern Growth Strategy to create an interconnected supply chain of gas infrastructure assets in northern Australia.
Adams said: “We know there is continued demand for gas across the east coast and that northern Australia will play a leading role in meeting this demand by bringing new gas to where it is most needed, via the most direct and economic route.
“The AGPP is another crucial addition to our plans in northern Australia and allows us to play a leading role in bringing a new source of gas supply and greater competition to the market.
As per the terms of the deal, Senex will pay an agreed tariff for delivery of sales gas to the domestic market over a 25-year term.
Commissioning of the infrastructure is expected to be done by late 2019 with the project to open up nearly 200 jobs right through its planning, construction, and commissioning stages.
Jemena, which was selected as preferred partner by Senex following a competitive tender process said that the Darling Downs Pipeline offers direct access to the Wallumbilla gas hub while giving Senex flexibility to sell its gas to a variety of Australian gas customers.
Senex managing director and CEO Ian Davies said: “This transaction delivers a material component of Senex’s overall funding requirement, and we are on track to finalise the remaining corporate and development financing in mid-2018.
“With our financing in place and our path to market established we will then engage with potential domestic gas customers.”