Santos Ltd announced today that it has concluded a contract with Incitec Ltd for supply of its gas requirements at three plants in New South Wales. The major plant being supplied is the fertiliser production plant at Newcastle. The contract will commence from January 1998.
Incitec is one of the largest consumers of gas in New South Wales. It selected the Santos gas supply proposal as the most competitive available.
The term of the contract is to the end of 2002 as a minimum, and may be extended for a further period.
The Incitec gas load represents around 10 petajoules per annum, approximately 10 per cent of the current gas demand in New South Wales.
The gas sold to Incitec forms part of the existing contract quantity between AGL and the Cooper Basin Gas Producers. Santos will be selling the gas to Incitec on a delivered basis at Wilton, the Sydney city gate of the gas pipeline from Moomba.
The overall return to Santos from this arrangement will slightly exceed that under current arrangements.