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To: Tomas who wrote (1213)	7/27/1999 8:54:00 PM
From: Tomas	Respond to of 2742

More signings for PNG gas expected. First gas is now expected by late 2002 PostCourier, July 28 THE joint venture partners in the PNG Gas project are close to securing a sale agreement with the Queensland government owned Ergon Energy to supply gas to North Queensland, a senior official said yesterday. Chevron Services Australia Pty Ltd, Cliff Leggoe, external affairs manager for the project operator said the deal will secure the supply of about 50 petajoules to customers in north Queensland. Mr Leggoe was speaking to the Post-Courier after the signing of preliminary agreements between the project partners and foundation customers in Brisbane yesterday. Gas for the project will initially flow from the Kutubu and Gobe fields and later from Hides. Around 20 petajoules of gas has been allocated for the first stage of Comalco's proposed refinery and Sithe Energies subsidiary will take 14 to 22 petajoules a year for its 350-400 megawatt Gibson Island Cogeneration Plant near the mouth of the Brisbane River. ''Gibson Island is now set to become a foundation customer for PNG gas, ensuring the PNG gas pipeline comes directly to Brisbane,'' the company said. AGL managing director Len Bleasel said it was working with project sponsors to decide on the most satisfactory route to deliver gas into the Brisbane market. AGL and joint venture partner Petronas won the $1.5 billion contract to build, own and operate the 2100 kilometre pipeline from the PNG border to Gladstone. ''We are now studying various delivery options, including the possible construction of a new pipeline direct from Gladstone into Brisbane,'' Mr Bleasel said. First gas is now expected by late 2002, Mr Leggoe said. It was congratulations all around yesterday following the signing with Energex. PNG Gas project director Dr John Powell welcome the signing of the preliminary agreements. Former Petroleum and Energy minister Sir Rabbie Namaliu said the extension of the pipeline to Brisbane will not only benefit customers, but would also assist the development of the PNG gas industry. postcourier.com.pg

To: Tomas who wrote (1213)	7/27/1999 9:00:00 PM
From: Tomas	Respond to of 2742

PNG pipeline: Big customers sign 20-year supply contracts. The Australian, July 28 By RICHARD SPROULL PIPING Papua New Guinea natural gas through to south-east Queensland is another step closer to reality after four foundation customers signed 20-year supply contracts to take up to 130 petajoules of gas a year. Pipeline proponents Chevron Asiatic, Oil Search, Orogen Minerals and their partners agreed on price, volume, terms and conditions for the supply of gas to Comalco, Sithe Energies and State-owned electricity generators Tarong Energy and CS Energy after 70 days of negotiations with Energex, a government power utility which acted as an "aggregator" and agent for the customers. Shares in all the key listed players rose in response to the agreements, with Oil Search shares climbing 12c to close at $2.38 and Orogen Minerals finishing 9c higher at $1.90. Energex subsidiary Allgas had earlier signed purchase agreements with the four customers ahead of yesterday's deal, which now places the base load requirement for the pipeline well within reach. The Allgas contract "is effectively the green light for the PNG gas pipeline, with the foundation customers now agreeing on price, gas volumes, fundamental terms and conditions", Queensland Premier Peter Beattie said. Analysts speculate the price paid was between $2 and $2.50 a gigajoule, though neither the customers nor the proponents would discuss the tariff. The contracts, which must be ratified by the companies' board of directors, account for around 70 per cent of the sales required for final approval on the $3.7 billion project. "This contract alone is very close to the foundation volumes required to underpin the development of the PNG gas project," Chevron project director John Powell said. Comalco has been allocated 20 petajoules a year and will move into the final feasibility study for its proposed $1.4 billion alumina refinery at Gladstone. It is also close to signing preliminary supply contracts with Malaysian energy producers for the same scale plant in Sarawak and expects to choose between the sites after completing separate studies. Of the other customers, Tarong Energy plans to build a 700 megawatt power station at Wivenhoe, CS Energy proposes building a 350MW station at Swanbank and Sithe Energies has proposed construction of a 350MW station at Gibson Island at the mouth of the Brisbane River. The project proponents are now waiting on signing of a contract to supply 50 petajoules of gas annually to customers in northern Queensland represented by State-owned utility Ergon Energy. Chevron and its partners will soon begin a $US60 million ($92.3 million) front-end detailed engineering design for the 2100km pipeline, ramp-up financing, work on the product development licence and negotiate access with landowners in the PNG southern highlands in the lead-up to a green light on the project. theaustralian.com.au

To: Tomas who wrote (1213)	7/27/1999 9:14:00 PM
From: Tomas	Read Replies (1) \| Respond to of 2742

'Green light' for PNG gas project. Chevron said "ways of fast tracking the project were being studied in an effort to commence gas supplies by the end of 2002" 'Green light' for PNG gas project The National, July 28 By KEVIN PAMBA and BRIAN GOMEZ PORT MORESBY: Four foundation customers have provided the effective "green light" for the historic US$3.5 billion (K8.9 billion) PNG to Queensland gas pipeline project. The announcement of the signing of preliminary sales agreement, heralding the development of the biggest project ever for PNG and Queensland, was welcomed both in PNG and Australia. The operator of the project, Chevron Services Australia, said in a statement that the proponents had concluded negotiations on an agreement to supply gas to Allgas Limited, a subsidiary of the Queensland State Government-owned utilities group, Energex. "Energex has acted as an aggregator for the sale of gas to a number of major customers including Tarong Energy, Comalco, Sithe Energies and CS Energy," Chevron said in a statement. "The 20-year contract is for up to 130 petajoules of gas per year for supply to a number of industrial, commercial and domestic customers in south eastern Queensland." Queensland Premier Peter Beattie described as "momentous" the completion of the agreement at three o'clock yesterday morning between Energex and the PNG gas partners and back-to-back agreements between Energex and its customers. "This is effectively the green light for the PNG gas pipeline, with the foundation customers now agreeing on price, gas volumes, fundamental terms and conditions," Mr Beattie said. The project will be the largest in PNG history with faster spin-offs in terms of employment and revenue generation. It holds out similar promise in Queensland. Queensland's Deputy Premier Jim Elder described the project as Australia's biggest infrastructure project since the Snowy Mountains Scheme with capital investment that was expected to reach A$8.1 billion by 2001. Project director Dr John Powell said: "We welcome the initialling of this first gas sales agreement with Energex. "This contract alone is very close to the foundation volumes required to underpin the development of the PNG gas project. "Energex is to be congratulated for its support for gas fired power stations. "Gas fuelled co-generation plants deliver a 75 per cent reduction in carbon dioxide emissions compared to a coal fired power station." A consortium spokesman told The National about US$1 billion of total project spending would occur in Queensland with the remaining US$2.5 billion needed to build the gas collection and pipeline system in PNG. The partners in the gas consortium have commissioned the Australian National University to conduct economic modelling of the venture to determine economic impacts on PNG. Results are anticipated in the next few weeks. Two former PNG resources ministers who were actively involved in the project negotiations, Sir Rabbie Namaliu and Masket Iangalio, welcomed the announcement in separate statements late yesterday. Prime Minister Sir Mekere Morauta and new Petroleum and Energy Minister Tommy Tomscoll could not be reached for comment last night but since coming into office a fortnight ago, Sir Mekere has highly commended the progress of the project saying it can assist the ailing PNG economy significantly. Mr Iangalio said Chevron, Oil Search and all parties have made a breakthrough by signing up the first customer. "I was more than pleased with the project moving another step forward to reality," said Mr Iangalio. Sir Rabbie said "the signing underpinned the economic viability of the pipeline project and there is no doubt in my mind that it would now proceed". Mr Iangalio said the project is set to generate A$300 to A$400 million in tax revenue alone and said it is sufficient to replace the annual Australian budgetary support which will be phased out next year. Chevron said once the agreements have been approved by the respective boards, the project will move into front end engineering and in parallel, final approval and financing activities. This is expected to take around 12 months. Gas for the contract will initially flow from the oil producing Kutubu and Gobe fields in Southern Highlands and later from the Hides field some 70 kilometres to the northwest of Kutubu. The consortium of Australia Gas Light company and Petronas will build, own and operate the Australian leg of a spur line from Gladstone to the Brisbane area. AGL's Managing Director Len Bleasel said his group was "studying various delivery options, including the possible construction of a new pipeline direct from Gladstone into Brisbane. "At this stage we believe financial closure can be achieved by mid next year and then the pipeline could be completed by early in 2003," he said. However, Chevron's spokesman, Cliff Leggoe, told The National ways of fast tracking the project were being studied in an effort to commence gas supplies by the end of 2002. In other related announcements: Gibson Island Power Pty Ltd, a subsidiary of Sithe Energies Australia Pty Ltd, said it planned to use gas from PNG for a 350-400 megawatt cogeneration plant near Brisbane. It would cut greenhouse gas emissions by 60 per cent compared with existing coal-fired power stations. Queensland's Minister for Mines and Energy, Tony McGrady, said the three power project proponents had plans to generate an additional 1400 MW of electricity with a A$1 billion investment. While not all these projects may go ahead, the quantity of PNG gas targeted for this sector is only adequate for generation of about 750 MW. Comalco yesterday also announced the start of a final feasibility study for the Gladstone site option of its proposed 1.4 million tonnes a year alumina plant. wr.com.au