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Gold/Mining/Energy : Lundin Oil (LOILY, LOILB Sweden) -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (816)	11/5/1998 8:48:00 PM
From: Tomas	Read Replies (2) \| Respond to of 2742

PNG gas price: The most significant step in the project's development since May Post Courier, Port Moresby, 06/11/98 THE release of competitive tariffs for the Papua New Guinea to Gladstone gas pipeline has made it viable to consider delivering gas further south into the Brisbane market, parties associated with the project said yesterday. The release of the tariffs followed the approval of the pipeline's access principles by the Queensland Energy Regulator and the Australian Competition and Consumer Commission. The Australian section of the pipeline will be built, owned and operated by a joint venture between Australian Gas Light and Petronas, Malaysia's national oil and gas company. According to AGL's group general manager for energy infrastructure, Greg Martin, the tariffs would bring PNG gas to Queensland at lower prices than was available from competing suppliers. ''The tariffs are considerably below market expectations due to their innovative structure and will provide the catalyst for customers to commit to the project within the required time frame,'' said Mr Martin. ''A single zone price will apply from the PNG-Australian border to Gladstone.'' Chevron officials in Port Moresby pointed out yesterday that the low tariff rates did not mean PNG gas would be sold cheaply. They said the announced tariff rates were simply for the transportation of gas. The announcement of the tariff is a key milestone and the most significant step in the project's development since May, when the AGL/Petronas joint venture was awarded the contract. The Queensland government has also welcomed the release of the tariffs which it said were ''very competitive and should come as a pleasant surprise to the market and customers''. ''The gas transportation tariff on the Australian portion of the pipeline is under $A1.00 per gigajoule for establishment customers, which makes it one of the most competitively priced pipelines in Australia,'' Queensland Mines and Energy minister Tony McGrady said. Mr Martin said the market required the joint venture to provide competitively priced gas to Gladstone. The tariffs for transportation of gas from the PNG boarder to Gladstone on the central Queensland coast will start at 99.79 cents per gigajoule for customers whose load is constant throughout the year and who commit to the project by January 31 next year. Previously mooted figures had suggested tariffs of up to $A1.80 per gigajoule. ''These are the lowest tariffs in Australia on a S/GJ of gas throughput per kilometre transport basis,'' Mr Martin said. He said the tariff was a result of a competitive tendering process the first under the National Third Party Access Code, involving 26 players, many from overseas. The process was overseen by the Queensland and Federal Governments, with approvals being granted by the Queensland Energy Regulator and the ACCC. Queensland's State ministers for Development, Jim Fielder said he was pleased to note the competitive price being offered. ''The release of the tariffs should help significantly boost market confidence and will be an important step towards the signing of conditional sales agreements with customers,'' Mr Elder said. Meanwhile, Oil Search Ltd, Ergon Energy and NRG Asia-Pacific Ltd yesterday announced plans to form a commercial alliance to explore business opportunities stemming from the project, including the delivery of gas from Gladstone to Brisbane. Other opportunities being considered by the alliance included purchasing PNG gas and other products, the establishment of gas-fired power generation units in Queensland, and the formation of a company to trade and market gas in conjunction with power. NRG Asia-Pacific, a subsidiary of US-based NRG Energy Inc, is one of the potential foundation customers of the pipeline projects. It plans to build a power station at Gladstone. 203.22.79.35