The deal includes the construction of a 4 km lateral from APA’s Eastern Goldfields Pipeline (EGP) to the site of the MMGP power station.
The 4 km gas lateral will be named the Mt Morgans Gas Pipeline and will connect to a barred-tee installed in the EGP, which passes through the MMGP.
The term of the GTA with Dacian is for up to 10 years following an initial 6 month period which allows Dacian to reach steady state operations in order for it to determine actual gas volumes for transport to the power station ahead of undertaking firm take or pay commitments.
APA has commenced work programs on design and engineering of the pipeline and associated infrastructure, geotechnical studies and ordering of long-lead items.
Under the GTA, gas will be transported to the power station in Q1 of CY2018 in order to meet Dacian’s objectives of first gold production in March 2018.
Dacian will contribute $4.5 million to the capital cost for the GTA infrastructure, with the remaining capital and operating costs paid to APA via a transportation tariff.
Under the proposed 10-year term of the GTA, the total contract sum is approximately $57 million.