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Developing the east coast’s gas transmission network

Jemena is actively seeking opportunities to expand its pipeline assets such as the Eastern Gas Pipeline (EGP) and the Queensland Gas Pipeline (QGP) to provide future transportation solutions for its customers.

“We are currently aggregating loads for an expansion of EGP with the addition of two new mid-line compressor stations. We anticipate being in a position to kick off this project later this year subject to customer demand,”? says Jemena Pipelines General Manager – Commercial and Business Development Dave Green.

“I believe this expansion is necessary as the EGP is a key supply artery between the Gippsland Basin and New South Wales.”?

The EGP supplies more than half the gas consumed in NSW, so it is ideally located to meet the growing demand for natural gas in NSW from residential, industrial and commercial customers, particularly as the supply dynamics on the east coast change.

“The current changes in the east coast gas market mean gas transmission pipelines are critical in linking key demand and supply centres and providing highly reliable transportation services. Jemena is also interested in developing new pipelines if this is required to secure supply for our customers,”? says Mr Green.

The EGP supplies gas to a number of regional gas distribution networks as well as the Jemena Natural Gas Network (JGN), which distributes gas to over 1.1 million homes and businesses throughout NSW. On the JGN, 30,000 new customer sites are added each year and this is driving an increase in demand for natural gas.

Industrial and commercial users include BlueScope Steel at Port Kembla, Marubeni’s power station at Smithfield and EnergyAustralia’s power station at Tallawarra.

Mr Green explains that to service the increasing demand for gas transmission in NSW, the next logical capacity expansion can be achieved through the addition of two new compressors on the mainline at Orbost, Victoria and Michelago, NSW.

“It is anticipated that this next stage of expansion will increase the EGP’s total capacity from 106 petajoules per annum (PJ/a) to 130 PJ/a, and will take approximately two years to deliver. There is also the capability to loop the EGP in the future should demand exceed the expansion plans that are under consideration,”? says Mr Green.

Since 2007, Jemena has successfully completed three major transmission pipeline expansion projects. To the EGP it added a midline compressor station near Mila, NSW and the installation of a fourth compressor at Longford, Victoria. On the QGP, it has doubled capacity with a 113 km looped section and two mid-line compressor stations.

Expanding for the future

Mr Green says that there are also potential expansion opportunities for Jemena’s other 100 per cent-owned transmission gas pipeline, the QGP.

“With the QGP, there is the potential to continue to play a key role in shipping gas to Gladstone, both for the domestic market and for LNG opportunities,”? says Mr Green.

Jemena has recently entered into an agreement to expand the QGP with commissioning expected in 2015. In addition, further expansion opportunities for the domestic market or the LNG market are being pursued.

In March 2011, LNG Ltd, proponent of the Gladstone “˜Fisherman’s Landing’ LNG Project, signed an agreement with Jemena to investigate the expansion capacity of the pipeline, to evaluate the potential for it to transport gas from the Wallumbilla Gas Hub to the Callide Gas Hub in Gladstone.

“The QGP also supplies gas to commercial and industrial customers such as Queensland Alumina, Rio Tinto, Orica, Boyne Smelter and Queensland Magnesia, so we are in an ideal position to meet an increase in demand from such customers.”?

Asked how an expected gas price increase might affect the progression of potential expansion projects, Mr Green says that the projects are part of the solution to bring more gas supplies to market as the market responds to the changes in the gas industry.

“Our transmission pipelines are ideally located to meet growth in demand for gas in NSW, Victoria or Queensland.

“Jemena is always interested in developing new pipelines if there is market demand.”?

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