It proposes to sell its 10% share of gas production from the Minerva field through subsidiary Santos Direct to industrial customers and into the Victorian spot market.

Santos is already one of Australia’s largest gas producers supplying gas at the wholesale level to major industrial customers and specialist marketers in all mainland Australian states under long-term contracts.

But marketing and selling gas directly into the retail market is a first for the company.

“The retail gas licence expands Santos’ marketing options by giving us another channel for selling gas directly to industrial customers and into the spot market,” Santos managing director Ellice-Flint said this morning.

“Having greater flexibility and the option to market separately from the joint venture builds on Santos’ commercialisation and marketing expertise to deliver better returns for our shareholders.”

When full design rate is reached shortly, the new development will produce up to a maximum gross production rate of 150 terajoules of sales gas per day (TJ/d) and up to 500 barrels per day (gross) of stabilised condensate.

The project consists of two sub-sea well completions in 60 metres of water, about 10 kilometres offshore from Port Campbell, Victoria.

The project is owned by BHP Billiton (90%) and Santos (10%).