EDL will use the gas to supply four gas-fired power stations under construction as part of their West Kimberley Power project in the West Kimberly region of Western Australia.
EDL will convert the gas to liquefied natural gas (LNG) at a new facility to be built at Karratha before transporting the fuel by road tankers to gasfired power stations located in Broome, Derby, Fitzroy Crossing and Halls Creek.
The electricity will then be sold under a recently executed power purchase agreement with Western Power Corporation.
Under the contract, which will commence in the first half of 2006, the initial supply commitment is six terajoules per day (TJ/d) and will then increase over the life of the contract to nine TJ/d. Santos and Apache also have the opportunity to increase daily contract quantities in the future subject to gas availability and their consent.
John Ellice-Flint, Santos’ managing director said “This contract will assist Santos to fully exploit the value of the investment being undertaken to develop the John Brookes gas field.”
“EDL’s West Kimberly Power project is an innovative project supporting further development of the Kimberly region. The gas-fired power stations will replace the existing diesel power stations and deliver cleaner power for these Kimberley communities”, said Ellice-Flint.
The JV signed an initial contract for the field in August to supply Newcrest with 120 petajoules (PJ) of gas over 15 years. Newcrest will require a maximum of 25 terajoules (TJ) per day for power generation at the Telfer gold mine, in the Pilbara region of Western Australia, beginning no later than December 2004, and will support both the open cut and underground operations phases of the Telfer mine.
Initially the contracted gas will be supplied from the nearby East Spar gas field until the John Brookes field commences production in mid 2005.
The John Brookes field is located in exploration permit WA 214-P, in the Carnarvon Basin, offshore Western Australia with Apache Northwest holding a (operator) 55% interest and Santos 45%.
