Meridian SeamGas Joint Venture to Supply Natural Gas to Gladstone LNG Project in Australia

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Researched by Industrial Info Resources Australia (Perth, Australia)--The Meridian Seam Gas Joint Venture will supply natural gas to the Gladstone LNG (GLNG) project, operated by Santos (ASX:STO) (Adelaide, Australia). A supply agreement was signed on March 27.

The Meridian SeamGas Joint Venture includes WestSide Corporation, with a 51% ownership stake, and Mitsui E&P Australia, with a 49% stake. The Meridian coal seam gas (CSG) natural gas fields have been producing since July 2010. The field currently produces 10 terajoules (TJ) per day under contract; however, the facilities are capable of a producing three times that amount, and the export pipeline has a maximum capacity of 60 TJ per day.

The supply deal will take effect in 2015, once the Gladstone liquefied natural gas (LNG) production plant and supporting infrastructure become operational, for a period of 20 years. The gas price will be oil-linked from 2016.

The Gladstone LNG (GLNG) project, operated by Santos (ASX:STO) (Adelaide, Australia), is almost 80% through the construction phase. The foundation phase of the project is expected to be completed by the middle of 2015. The project is slightly behind schedule, with Santos now expecting to begin LNG shipments sometime in the second half of 2015, rather than by the middle of 2015.

The Santos-operated GLNG project is one of three CSG-to-LNG projects under construction on Curtis Island, off the coast of Gladstone in Queensland. The GLNG project will be the second one to begin production.

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