QGC will be able to use 40PJ of its own gas for the Chinchilla power station after cancelling a gas supply agrement with CS Energy.

QGC refused to approve an extension to the agreement on Berwyndale South gas.

"CS Energy required QGC to undertake further work and has not approved the development plan and the reserves expert report in sufficient time for the facility to be constructed by the final date under the gas agreement," said QGC managing director Richard Cottee.

"But the advent of the proposed Chinchilla power station means QGC shareholders should now receive substantially higher returns from its own gas it has proved up at Berwyndale South."

The additional certified reserves at Berwyndale South in the Surat Basin increase total certified proved and probable (2P) reserves to 79.9PJ, an increase of 9.7PJ from the total announced in July this year.

Adding certified possible reserves, the new total certified reserves from Berwyndale South stands at 380.2 PJ (or 369.5 bcf).

The Berwyndale South wells are located only 13km from the Roma-to-Brisbane gas pipeline.

They are also just 10km from QGC’s Argyle pilot appraisal wells which are currently being tested as part of the company’s reserves expansion program. These pilot wells share the same site as the planned gas-fired power station.

Adding the earlier Argyle pilot results to the new Berwyndale South reserve assessment brings the total 3P reserves in QGC’s Surat Basin fields to 549.9 PJ (or 532.8 bcf).

QGC has recently applied for a licence to construct and operate a gas pipeline from Argyle, within ATP620P, to the Roma-to-Brisbane gas pipeline. Approval has also been sought for a pipeline from Argyle to Berwyndale South within PL 201.

Interests in PL 201/ATP 632P are QGC (operator) 50% and CS Energy Ltd 50%. Interests in ATP 620P (the Argyle field) are QGC (59.375%) and Pangaea Oil & Gas Pty Ltd (40.625%).