Australia's WestSide Corporation to Start New Wells in Meridian Field

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Researched by Industrial Info Resources Australia (Perth, Australia)--WestSide Corporation Limited (ASX:WCL) (Brisbane, Australia) and joint venture partner Mitsui E&P Australia Pty Limited (Perth, Australia) are set to begin drilling in the Meridian Coal Seam Gas/Coal Seam Methane (CSG/CBM) fields in Australia.

Phase I of the program includes the drilling of six new wells in the proven Meridian Natural Gas Fields located just outside Moura, Queensland, within the CSG-rich Bowen Basin.

The expansion program follows the awarding of a 20-year sales agreement with Santos (ASX:STO) (Adelaide, Australia) and the venture partnership of the Gladstone Liquefied Natural Gas (GLNG) project, which is under construction on Curtis Island, and is expected to be completed and to produce its first gas in 2015.

Under the terms of the agreement with Santos, the Meridian gas field will supply increasing volumes of gas to GLNG from 2015. Starting in 2016, up to 65 terajoules, or 61 million cubic square feet per day (MMSCFD), of gas per day will be supplied from the Meridian field to GLNG over 20 years at an oil-linked gas price.

Current production in the Meridian field stands at 12 terajoules (11 MMSCFD). With the expansion programme and subsequent work-over of existing wells, WestSide expects to gradually ramp up production to meet the needs of the GLNG project on schedule. Existing infrastructure within the Meridian field allows for up to 30 terajoules per day (28.2 MMSCFD) of compression without additional capital expenditures.

The announcement of the Phase I project has brought about a takeover bid from investment firm Landbridge Energy Australia Pty Limited (Melbourne, Australia), which first offered an off-market bid of 32 cents per share, but has now raised the offer to 40 cents per share. WestSide has urged other major holders to take no action on the bid as the company considers its options.

WestSide has other interests within the Bowen Basin, and it continues with the exploration and appraisal program at the ATP 769P (Paranui) and ATP 688P (Tilbrook and Mount Saint Martin) sites. WestSide holds a 25.5% interest in the tenements with Mitsui E&P Australia Pty Limited (24.5%) and Queensland Gas Company (QGC) (50%) (Brisbane, Australia).

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