Under the memorandum of understanding, Metgasco will supply BP with 15-22 petajoules of gas per year, which will involve extending the company’s planned Casino to Ipswich pipeline to the Port of Brisbane.
Metgasco has begun the development approval process for this pipeline, which is planned to supply gas to Metgasco’s Clarence-Moreton Basin partner CS Energy, which farmed-in to a Metgasco permit in December last year.
The goal of that agreement was to prove 2P (proved and probable) gas reserves of 540PJ, to be used to supply 18PJ of gas per year to CS Energy, and to develop the gas pipeline to the Swanbank Power Station.
The deal represents a gas sale value of over $A1 billion over the proposed 20-year term.
Earlier this month, Metgasco announced an incremental increase to its 2P reserves. It has gas reserves of 1156PJ (1P) and 194PJ (2P), with a target of establishing 2P reserves of 660PJ by mid-2008.
Metgasco holds the largest independently certified gas reserves in NSW, with over 1 trillion cubic feet (3P) in the Clarence Moreton Basin of northeast NSW.
Pilot production drilling at North Casino started in November, aimed at establishing productive gas flow rates and to assist in the company’s gas reserve expansion strategy.
