Australian energy company Santos has signed an agreement to supply wholesale gas for Visy’s New South Wales (NSW) operations.
To become effective from 1 January next year, the contract was awarded following a competitive process.
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Visy chief operations officer Mark De Wit said: “The new gas supply agreement with Santos provides certainty of gas supply in 2019 for our energy-intensive operations in NSW. We appreciate the strong and continuing relationship between Santos and Visy.”
Santos managing director and CEO Kevin Gallagher said Santos proposes to work with Australian industry to supply domestic gas that is competitively priced.
Gallagher said: “We’re drilling about 87 wells in the Cooper Basin this year – more wells in a single year since 2014. We’ve arrested production decline in the Cooper and production is actually growing again, which is great news for the east coast gas market. We’re also drilling a record 300 GLNG wells in Queensland.”
“Since 2015, we’ve reduced our completed well costs by 50% in the Cooper Basin and connected well costs by a phenomenal 84% in Queensland, locking in our position as Australia’s lowest cost onshore gas developer.”
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By GlobalDataSantos believes that drilling more wells and lowering production costs will help to reduce gas prices.
The company is on track to deliver approximately 70PJ of gas to the east coast market this year, which is 13% of the expected demand this year.
Founded in 1954, Santos manages five core long-life natural gas assets, including the Cooper Basin, GLNG, Papua New Guinea, Northern Australia and Western Australia Gas to ensure stable production and supply of LNG.
