Galilee Energy and Jemena have signed an agreement to accelerate plans to deliver gas from the Glenaras project in the Galilee Basin in central Queensland, Australia to the east coast domestic market.
Under the agreement, the companies have agreed to jointly work towards achieving certain milestones that will enable the delivery of gas from Galilee’s Glenaras project.
The agreement allows Jemena to expedite its plans to build a new pipeline aimed at delivering gas to the east coast by commencing negotiations with local community and field surveys, as well as pipeline design concept works.
Meanwhile, Galilee Energy is expected to proceed with its appraisal activities at the project in order to determine whether the gas resource is large enough to underwrite the pipeline construction.
Galilee Energy managing director Peter Lansom said: “Galilee Energy has one of the largest uncontracted contingent gas resources on the east coast. The company’s upcoming lateral programme has the potential to unlock this resource into a significant reserve position.
“The company’s upcoming lateral programme has the potential to unlock this resource into a significant reserve position.
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By GlobalData“This partnership is all about working together to get this critical gas supply option to the domestic market as quickly as possible.”
The company expects the front-end engineering and design (FEED) on both pipeline and field development to commence in 2019.
The deal is set to complement Jemena’s plans to expand its Northern Gas Pipeline, through the Galilee Basin, to the gas markets on the east coast.
Construction of the 622km pipeline, linking Tennant Creek in the Northern Territory and Mount Isa in Queensland began in July this year, with first gas scheduled to flow next year.
Based on reports from Australian Energy Market Operator (AEMO), the country is projected to experience gas shortage as of next year.
Last month, the Australian Government reached agreements with gas producers Santos, Origin and Shell in order to address the demand-supply gap and cover the shortfall.
The Queensland Government also revealed plans to release land for more than 19,000km² for petroleum and gas exploration under its new annual exploration programme.
