State Gas advances Queensland gas project

Sydney-listed State Gas on May 30 announced it is progressing with the importation and commissioning of equipment to support production testing and early-stage gas sales from its Rolleston West (ATP 2062) and Reid's Dome (PL 231) projects in the southern Bowen basin in Queensland.

State Gas is planning to truck CNG to the market to commercialise its proven gas resource at Reid's Dome project in Queensland. The first delivery is expected in July this year. 

The Reid's Dome CNG project has been delayed due to a delay in the delivery of the compressor. The compressor, which underwent offshore fumigation, has returned to Australia and arrived at the company's engineering yard on May 17. State Gas said that the compressor is in good condition and is expected to support the proposed gas production rate of 1.7 TJ/day. Additionally, the dehydrator has completed fabrication and factory acceptance testing and was shipped from the Port of Shanghai on May 27. 

In the upcoming weeks, the equipment and other associated assets will be brought into compliance with Australian Standards for mechanical and electrical operation. Subsequently, they will be shipped to the site for commissioning.

"Despite the ongoing frustrations with international supply chain constraints, the company is now close to commissioning its CNG processing equipment and is on track to commence the sale of compressed natural gas in July 2023. Given the spot price domestically is already hovering over A$20/GJ, the wait has proved worth it," Richard Cottee, the executive chairman of State Gas, said.

On March 17, the Queensland government approved changes to the company's pre-existing environmental authority for PL 231, which allows State Gas to move forward with construction and commissioning activities for the CNG project. The company in November entered into a memorandum of understanding with Brisbane-based Mine Energy Solutions securing access to CNG virtual pipeline infrastructure.