Senex Energy has reached an agreement with infrastructure operator Jemena to jointly pursue the accelerated development of Project Atlas in Queensland, Australia, in order to deliver gas to the domestic market by late next year.
The partners will undertake the construction of a gas processing facility with an initial capacity of 40 terajoules a day and a 60km pipeline connecting the Atlas gas field in Queensland’s Surat Basin to the Wallumbilla hub through the Jemena-owned Darling Downs pipeline.
Jemena will own and operate the downstream infrastructure being developed by the partners.
Through Project Atlas, Senex intends to deliver natural gas from coal seams on acreage located near Wandoan and Miles in the Surat Basin.
Senex Energy managing director and CEO Ian Davies: “Jemena operates significant gas infrastructure across the east coast and their involvement in Project Atlas will allow us to focus our efforts and capital on the upstream, delivering gas to domestic customers from late 2019.
“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.”
Under the terms of the deal, Jemena will fully fund the development of the downstream infrastructure, expected to cost around A$140m ($104m), covering the design, construction and commissioning.
Senex will pay an agreed tariff to Jemena for around 220PJ of firm capacity for delivery of sales gas to the domestic market over a period of 25 years.
The agreement will also see Senex delivering raw gas into the downstream infrastructure, while Jemena is required to deliver sales specification gas into the Wallumbilla Gas Hub.
