APA Increases Compression on the Goldfields Gas Pipeline

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Researched by Industrial Info Resources (Sugar Land, Texas)--Development work is under way on increasing the capacity of the Goldfields Gas Pipeline with the upgrading of two existing compressor stations and, in an entirely separate project, the construction of two new compressor stations 100 kilometers to the east.

The Goldfields Gas Pipeline spans more than two-thirds of Western Australia, and at 1,380 kilometers is the second-longest pipeline in the state. It supplies natural gas to mines and power generators in the Pilbara and Goldfields region, and has a current capacity of 150 terajoules per day. This is expected to increase more than 25% when this round of expansion is complete in 2014.

These two expansion projects resulted from the recent signing of supply agreements between APA Group (Sydney, Australia) and both Rio Tinto Limited (Melbourne, Australia) and BHP Billiton Limited (NYSE:BHP) (Melbourne, Australia).

The first project calls for the upgrade of the Yarraloola and Paraburdoo compressor stations in order to meet a new 20-year supply agreement with Rio Tinto, resulting from increased energy needs as their West Angelas power generation site expands. Approximately 22 terajoules per day will available as a result of this expansion, and construction completion is scheduled for mid-2013.

A 15-year supply agreement underpins the second expansion plan. New compressor stations are to be built at Turee Creek and the Newman Inlet in order to supply 23 terajoules per day to the Mount Newman Joint Venture, of which BHP Billiton owns 85%. Originally, looping of the existing Newman Lateral was considered, but installing compression at the laterals inlet has been identified as a more commercially viable alternative.

All four compressor stations will house new Solar Centaur compressor packages and associated ancillary equipment and infrastructure. The ordering of long-lead items, such as compressor packages, has already commenced, with the balance of the plant tendering process expected to be completed soon. Momentum Engineering Pty Limited (Perth, Australia) has been working with APA on the design requirements for both projects.

Capital expenditures for this expansion project are expected to surpass $157 million (AUS$150 million) over the next two years, with APA managing the construction on behalf of the Goldfields Gas Transmission Joint Venture (Perth, Australia). APA owns 88.2% of the joint venture, with the other 11.2% being held by Alinta Energy Pty Limited (Sydney, Australia).

APA has announced it expects to begin planning work on further expansion of a gas pipeline network within Western Australia upon completion of the company's current expansion projects.

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