Red Gully Gas Plant Now Up and Running in Western Australia

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Researched by Industrial Info Resources (Perth, Australia)--Empire Oil & Gas (ASX:EGO) (Perth, Western Australia) says that the export gas compressor at its Red Gully Gas and Condensate Plant has been run extensively over the last week and is now officially "bedded in."

As part of the commissioning process, the facility has been testing all the essential equipment and operating at a range of production rates from 4 to 10.71 terajoules per day (TJ/d). The operating production rate for the plant is expected to be about 10 TJ/d. The facility's process control operations are now stable enough to be left in full automatic mode.

The gas produced during testing achieved the "sales gas" quality requirements enforced by DBP (WA) Transmission Pty Limited (Perth, Australia), which operates the Dampier-to-Bunbury Natural Gas Pipeline (DBNGP). Empire delivered gas into the DBNGP from the facility on June 7 and June 9, 2013.

Gas at Red Gully is being produced with a sales agreement in place with Alcoa of Australia (ASX:AAI) (Perth). Under the sales agreement, Alcoa agreed to pay $24.01 million (AUD$25 million) for the cost of constructing the Red Gully Gas and Condensate Facility.

Operations will continue, with the Red Gully-1 and Gingin West-1 wells being flowed at various rates to settle optimal flow and condensate recoveries from both wells. Currently, the first load of Red Gully-1 condensate is being loaded into road haulage tankers. Condensate produced by the plant, estimated to be about 832 barrels per day, will be transported to the Kwinana oil refinery south of Perth. Careful consideration was taken during the design phase of the project to ensure the processing facility would comply with both the gas requirement specifications of the DBNGP and the condensate requirements for the BP Refinery.

Craig Marshall, the managing director of Empire, said that the company is now turning their attention to the future. "This 3D seismic will give us the new definition, and we'll be drilling probably toward the end of this year for additional reserves, where the potential is for another 200 BCF [billion cubic feet] of gas," he said.

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