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Santos Limited today announced that it has commenced gas production in Victoria to assist the State in satisfying peak winter gas demand.

The gas comes from a new gas processing facility at Heytesbury, 160 km south west of Melbourne, which the company has built at a cost of $9m

The facility processes gas from the nearby Mylor and Fenton Creek gas fields.

The processed gas is supplied into the Victorian high pressure gas pipeline system and is ultimately transported to customers via the recently completed GPU Net 152 km South West Pipeline which links western Victorian gas fields with Geelong.

Mylor and Fenton Creek gas is being sold to the Victorian Governments Gascor Pty Ltd under a contract for sale for up to 15 terajoules of gas a day to the end of 2003. Condensate is also produced from the fields.

Commenting, Santos Managing Director Ross Adler said:

These fields have been developed as part of the Victorian Governments program of ensuring that additional gas supplies are available to meet winter demand.

They mark Santos first production in Victoria.

Since September last year we have also been supplying gas through the interconnect between NSW and Victoria.

We hope to further increase our contribution to meeting Victorias gas needs, both by supplying more gas from interstate and from production in Victoria. We have recently acquired an approximate 12.9% economic interest in the Kipper gas field in Bass Strait, which we hope will be developed by 2004.

The capacity of the interconnect between NSW and Victoria has recently been upgraded from 35 to 92 terajoules per day to provide further capacity in meeting peak winter demand in Victoria.

Santos has a 100% interest in the Mylor and Fenton Creek fields which are located in PEP108.

Santos is Australias largest onshore oil and gas producer. Its gas is used in all mainland states and territories. Its major producing fields are in the Cooper Basin in South Australia and Queensland, the Amadeus Basin in the Northern Territory and in the Carnarvon Basin in Western Australia.