Cooper Energy has signed a long-term gas sales agreement (GSA) for the next phase of Otway Basin with AGL to provide up to 10 PJ of natural gas annually for six years.
In a statement, Cooper Energy said the GSA is contingent on an affirmative Final Investment Decision (FID) on the Otway Phase 3 Development (OP3D), which is scheduled for H1 CY23.
From the start of production from the OP3D project, the GSA volumes account for around 50 per cent to 70 per cent of Cooper Energy’s portion of Otway gas production.
Some of the GSA’s key terms include:
- for the first three years, the starting annual supply was 8 PJ per annum, primarily from the Annie gas field, with a diminishing tail;
- subject to exploration progress, there is the potential for increasing volumes to a total of 10 PJ per year over the next six years;
- gas processed at Cooper Energy’s Athena Gas Plant;
- the first production is scheduled for 2025; and
- contract conditions and gas pricing that reflect the market.
The pricing system maintains the viability of the OP3D project while providing consumers with competitive gas.
Managing Director David Maxwell stated that the business was pleased to establish arrangements for the sale of gas with AGL that both support the OP3D project and allow Cooper Energy to supply additional supplies of competitive gas to gas users in South-east Australia.
“AGL is a high-quality and value-adding partner of our growing business. We are pleased to agree terms to support the commercialisation of OP3D and continue to build our relationship with AGL. This agreement is a key step to unlock further debt capacity under our senior secured debt facility to support funding the project and delivery of additional gas to the domestic market,” Maxwell said.
The OP3D project will soon begin front-end engineering and design.
Cooper Energy and Mitsui both have stakes in the Casino Henry operations and the Athena Gas Plant.
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