The Surat Gas Project Phase II involves the expansion of the existing Surat Gas Project in Queensland, Australia.
The expansion, known as the Surat Gas Project (SGP) North, will boost gas supplies to the market.
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Arrow Energy, an incorporated joint venture by Shell (50%) and PetroChina (50%), is the developer and operator of SGP. The 27-year project seeks to produce natural gas from the Surat Basin for a clean energy future.
The first phase of the gas project was approved in 2020. Arrow Energy unveiled plans to move forward with Surat Gas Project Phase II in Aug 2024.
Construction work for SGP North is scheduled to start in late 2024, with first gas expected in 2026.
Once operational, the expansion will deliver around 22,400 barrels of oil equivalent per day (boed) or 130 million standard cubic feet per day (mmscfd) of gas at peak.
Surat Gas Project Location
The SGP includes an area of around 5,385km2 (538,500ha). It is located nearly 160km west of Brisbane in Queensland’s Surat Basin.
The overall development area stretches from Wandoan township in the north towards Goondiwindi in the south, through Dalby.
It is separated into SGP North and SGP South for staged development.
SGP North, the expansion, is also referred to as the Girrahween Development. It includes Petroleum Leases (PLs) 304, 305, 491, 492, 494 and 1044.
These PLs are located northeast of the township of Miles in Southern Queensland.
Surat Gas Project History
As a part of the development of the Surat Gas Project, Arrow Energy announced a 27-year gas and sales agreement with Shell-operated Queensland-Curtis Liquefied Natural Gas (QCLNG) joint venture in 2017.
Under the agreement, Arrow will supply gas from the Surat Gas Project to QCLNG. Operated by Shell, QCLNG partners include Shell (73.75%), CNOOC (25%) and MidOcean Energy (1.25%).
Construction on the first phase of the project began in 2020 in the Dalby region. As of June 2024, 250 Arrow wells were in production. SGP Phase I will include more than 600 wells.
In 2023, QCLNG fulfilled 15% of the gas demand on the east coast of Australia.
Over its life, SGP is expected to deliver around 5 trillion cubic feet (TCF) of gas (around 4,000 petajoules) from approximately 2,500 wells. It will also create around 1000 jobs.
Surat Gas North Details
The Surat Gas Project North infrastructure will consist of up to 450 new gas production wells and associated gatherings. The wells will recover natural gas from coal seams in the Surat Basin.
It will be equipped with a four-compressor field compressor station of 121 tera joules per day (tj/d) capacity. A 27km-long new pipeline will operate on medium pressure and will connect the new field compression station to the Bellevue Central Processing Plant of Queensland Gas Company (QGC).
The project infrastructure will also include road and telecommunication upgrades, and water and brine infrastructure expansion.
It would also have a low-pressure gas connection to the McNulty Field compressor station of QGC.
Gas produced under Phase II will be transported to a medium pressure delivery point at the Bellevue Central Processing Plant. Low pressure gas will be transferred to QGC’s McNulty Field compression station.
All water or Coal Seam Gas (CSG) water produced during the extraction will be transported to a water delivery point at the QGC-owned McNulty Pond. Subsequently, the water will be processed by the QGC water treatment plants.
Peak construction period is expected to run from 2025-27. This phase is expected to involve an investment of more than A$500m ($275.72m).
Once operational, Phase II will deliver an additional 130TJ/day of gas to the market over 27 years. The development will create around 400 jobs in the Miles region.
This phase will be powered by a hybrid power plant (solar, battery, and gas).
Key Contracts
Arrow Energy awarded a multi-year construction contract for its CSG gathering network to MPK Kinetic in March 2024.
The scope of the contract included engineering, procurement, logistics, construction, and pre-commissioning activities for Surat Gas Project.
