Bloomberg Jan. 29 - Oil Search Says in Negotiations to Sell Papua New Guinea Gas to Queensland's Energex
Energex Ltd., an energy utility owned by the Queensland state government, may buy as much as 35 petajoules of natural gas from Papua New Guinea, shipped via a proposed US$3.5 billion pipeline.
The pipeline project would pipe gas 2,500 kilometers (1,500 miles) to Gladstone on the central Queensland coast, and could be extended to Brisbane, in the southeast corner of the state.
''PNG gas can be highly competitive with existing supplies'' into southeast Queensland, Oil Search said in its fourth quarter report. ''Energex have indicated that they may wish to contract up to 35 petajoules of gas, making them one of the largest customers for PNG gas.''
Total annual gas consumption in Queensland is currently about 50 petajoules, though that's expected to increase quickly as new supplies become available.
The partners in the pipeline, including Oil Search, Chevron Corp. and Mobil Corp., have been negotiating for more than a year with Comalco Ltd. to supply gas to its proposed A$1 billion alumina refinery at Gladstone.
The sale of gas to Brisbane-based Comalco, a unit of Rio Tinto Ltd., would account for about 27 petajoules of the 100 petajoules a year of contracts required for the pipeline project to go ahead. Comalco is also considering a location in Malaysia for the refinery.
Energex, one of two state-owned electricity retailers, last year bought Allgas Energy Ltd., a Brisbane-based gas utility, for A$250 million. |
