PNG to Queensland pipeline set to roll. "Project is now a near certainty"
Australian Financial Review, July 28
By Ian Howarth
The $3.7 billion Papua New Guinea to Queensland gas
pipeline has won its first gas sales contract ensuring the
project moves into the final stage of gaining approvals
and crucial financial support.
Queensland Government-owned power utility, Energex,
yesterday signed up to purchase 130 petajoules of gas a
year for 20 years on behalf of three south-east
Queensland electricity generators, Tarong Energy, CS
Energy and Sithe Energies and a handful of industrial and
domestic users.
Another gas supply contract is expected to be signed
shortly between the pipeline consortium and North
Queensland utility Ergon.
About 50 petajoules of gas demand is known to exist in
the potential North Queensland market.
Chevron, the main PNG gas pipeline promoter, said the
project is now a near certainty.
Chevron Services Australia project director, Dr John
Powell, said yesterday: "This contract alone is very close
to the foundation volumes required to underpin the
development of the PNG gas project".
Chevron has consistently maintained that the pipeline
required initial contracts for up to 140 petajoules to be
economically viable.
A total of 20 petajoules of the Energex contract can be
allocated to Comalco Ltd if it opts to build its $1.4 billion
alumina refinery at Gladstone, in north Queensland.
Originally the PNG gas pipeline was to be constructed
only as far as Gladstone, but the Energex contract, for
gas consumers in the Brisbane region, means the project
will almost certainly be extended to connect to south east
Queensland customers.
Tarong Energy is planning to build a 700 megawatt
gas-fired power station at Wivenhoe to replace its 500
Mw hydro power station while CS Energy is planning a
350 Mw plant.
Comalco chief executive, Mr Terry Palmer, said
yesterday the Energex gas deal: "Is a very welcome move
for Queensland.
"It enables Comalco to commence work immediately on
final feasibility for the Gladstone [alumina refinery] site
option for our proposed new alumina refinery," Mr
Palmer said.
afr.com.au |
