The field development agreement allows for the progression of the technical design and conditions toward developing resources in ATP 648P and ATP 620P, located in the Surat Basin. The CSG tenements are operated by QGC with APLNG’s permit interests being 31.25 per cent for ATP 648P and 40.63 per cent for ATP 620P.
The agreement also includes a conditional gas sales agreement to support the development of the Australia Pacific LNG (APLNG) and the Queensland Curtis LNG (QCLNG) projects, both to be located in Gladstone.
APLNG is a joint venture between Origin and ConocoPhillips, and includes a plan to develop a four train CSG to LNG project utilising Origin’s Queensland CSG reserves and resources. Origin will act as the upstream CSG operator and ConocoPhillips will be the downstream LNG operator, with the joint venture company to market the LNG. The project also includes the construction of a 450 kilometre gas transmission pipeline from the Surat and Bowen basins to a proposed LNG processing site located at Laird Point on Curtis Island, Gladstone.
The QCLNG Project involves an $8 billion onshore CSG to LNG production and export facility on the Queensland coast, with the supply of 190 petajoules (PJ) per annum of CSG from QGC’s Surat Basin tenements to be carried via a 380 kilometre pipeline to the processing facilities on Curtis Island, near Gladstone.
The commencement of gas sales to QGC is expected to begin with the start of commercial operations at the QCLNG Project, which is scheduled for 2014. The initial contract term for gas sales to QGC from ATP 648P is 20 years and QGC holds two extension options, each with a five-year term.
The parties have also agreed on a short-term gas sales agreement from ATP 620P for approximately two years from the commencement of commercial operations at QCLNG. Origin has said that the actual volume of gas sold will depend upon field development and performance.
The field development plans and gas sales agreements are conditional on QGC making a final investment decision on QCLNG, which is expected later this year, subject to environmental approval.
Origin Managing Director Grant King said “APLNG and QGC have agreed to work together to efficiently develop these jointly owned resources to support both of our planned LNG projects.
“APLNG expects to sell around 190 PJ of gas over an initial ramp up period of around two years to QGC under the agreements. APLNG will separately market the balance of its gas from these tenements for the long term.”?