The plan is to construct an offshore gas pipeline shore from the Blacktip gas and condensate field, which was discovered in September of last year, to an onshore based gas processing plant. An onshore pipeline would then transport the gas across country to meet the Darwin to Palm Valley pipeline or the Mt Isa pipeline.

Despite the recent announcement that Bayu-Undan gas was to be brought ashore to Darwin for processing, the entire gas reserves for Bayu-Undan have been committed to the LNG plant, which leaves no spare gas for sale into the domestic Northern Territory or Queensland markets.

Blacktip is located in WA-279P, owned by Woodside (35%), Shell (35%) and Agip/ENI (30%). The well logged five separate gas zones over a gross interval of 188 metres and established a tubing-constrained flow rate of 61.4 million cubic feet per day.

"Early studies for Blacktip are straightforward and are centred around an unmanned offshore facility with a pipeline being landed at Port Keats and a small onshore gas plant located nearby. That is the concept at this time but obviously further studies will be required.

"The fact that Bayu-Undan has entered the LNG market is exciting for acreage holders in the Bonaparte Gulf."

The spokesman hoped that with the long lead time being envisaged, Native Title agreements could be struck to the satisfaction of all parties involved.

"We're working on the premise that with the involved engineering required, it would be three to five years away. In that timeframe we can negotiate access. We're only talking about a small gas plant and a pipeline, in an area that frankly could do with some investment," he said.

Another line of industry speculation was that with Native Title being a possible issue, a subsea pipeline connecting to the Bayu-Undan trunkline would be a quicker way, although more expensive, due to the further distance, to bring gas to the NT and QLD gas markets.