GLNG to Buy Gas From Origin

Santos on Thursday announced that the GLNG project participants have agreed to buy 100 petajoules (PJ) of gas from Origin Energy for supply to the GLNG project.

The gas will be supplied at Wallumbilla over a period of five years commencing in January 2016 with pricing based on an oil-linked formula. Under the terms of the agreement, Origin can supply additional volumes of up to 94 PJ of gas during the same five-year period, Santos said.

GLNG had secured a diverse gas supply portfolio, comprising supply from GLNG’s own coal seam gas fields, Santos portfolio gas, underground storage and third party supply, said Vice President Downstream GLNG Rod Duke.

“The GLNG project is progressing well – we are now more than 72% complete and remain on track for first LNG in 2015,” Duke said in a statement.

The agreement announced Thursday adds to existing agreements for the supply of 750 PJ of Santos portfolio gas to GLNG over a 15-year period, and an earlier agreement with Origin for the supply of 365 PJ of gas over a 10-year period.

GLNG project includes the development of coal seam gas resources in the Bowen and Surat Basins in south-east Queensland, construction of a 420-kilometre underground gas transmission pipeline to Gladstone, and two LNG trains with a combined nameplate capacity of 7.8 mtpa on Curtis Island.

Santos has a 30% interest in GLNG. The other participants are Petronas (27.5%), Total (27.5%) and Kogas (15%).

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