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Summary

Darwin visit by Board of major energy grop

The Board of Directors of Santos Limited, one of Australias leading oil and gas companies, will meet this week in Darwin.Santos Chairman, Mr Stephen Gerlach, said the decision to hold the Board meeting in the Northern Territory reflected the importance of northern Australia as a key growth area for the oil and gas group.

“This week’s visit by the Santos Board coincides with the exciting opportunities for energy development in and around the Top End,” Mr Gerlach said.

“The Northern Territory has always been important for Santos and its significance is increasing every year,” he said.

Santos has had an involvement in the Territory since the 1950s and has supplied gas since the mid 1980s through its interest in the Mereenie and Palm Valley gas fields, west of Alice Springs, said Santos’ Managing Director, Mr John Ellice-Flint.

These fields provide twenty petajoules of gas each year, primarily for power generation, he said.

The Group’s recent key interests and activities in the region include:

A 10.6% interest in the world-class Bayu-Undan project under development north of Darwin – the only Australian company in the project

Ownership of the offshore Petrel and Tern gas fields, 250 kilometres west of Darwin in the Southern Bonaparte Basin

Ownership and operatorship of the Evans Shoal gas field located 320 kilometres east of Darwin, which is estimated to contain 6 trillion cubic feet (TCF) of gas

This month’s signing of a land rights agreement over the future supply of gas to Darwin and Alice Springs from the Mereenie oil and gas fields, southwest of Alice Springs.

Mr Ellice-Flint said the Commonwealth Government’s ratification this month of the Timor Sea Treaty was a major step forward for the liquefied natural gas (LNG) stage of the Bayu-Undan project, 500 kilometers northwest of Darwin.

“The signing brings an added degree of certainty to this stage of Bayu-Undan,” he said.

“We are now working closely with the Commonwealth and NT governments and project participants to advance the Bayu-Undan LNG project, with the onshore facility to be based at Wickham Point.”

First condensate and LPG production from the US$1.8 billion gas recycling stage is expected in April next year.

On the Territory’s need to replace the maturing Mereenie fields with new long-term gas supplies for domestic and non-major industrial use, Mr Ellice-Flint described the Petrel Tern fields, the major part of which is in NT waters, as the most logical solution.

“The Territory needs a second generation gas fuel source to take over and expand the role Mereenie has successfully played.

“Over the last year Santos has completed a major geotechnical re-evaluation of the resource potential of the Petrel Tern fields. They contain around 1,400 petajoules of contingent gas resources and with an anticipated local demand of around 60 petajoules per annum, the fields have the near shore volumes, security of supply and potential processing upside, to service local demand for up to 25 years.

“Development of the fields will also boost the region’s involvement as an energy hub.”