PERTH (miningweekly.com) – The Queensland government has given the green light to Arrow Energy’s A$10-billion Surat gas project, granting 14 petroleum leases between Dalby and Wandoan.

“The approval of these petroleum leases is a critical milestone in Arrow delivering five-trillion cubic feet of gas into the market. It’s a positive step for Arrow and for Queensland,” said Arrow CEO Mingyang Qian on Thursday.

The Surat gas project will bring an extra 5 000 PJ of gas to market over 27 years, including 240 PJ/y during peak production from 2026. Construction is expected to start later this year with first gas forecast to flow from 2020.

The Surat gas project follows the expansion of Arrow’s Daandine and Tipton fields during 2016/17, at a cost of A$850-million.

Premier Annastacia Palaszczuk said it was another vote of confidence in Queensland as a resources investment destination.

“The Surat gas project will create up to 800 construction jobs and 200 ongoing operational jobs, as well as millions of dollars in business opportunities for local suppliers,” Palaszczuk said.

“Currently scheduled to be operational in 2020, the project will produce gas for liquefied natural gas (LNG) for export and for domestic users. This is the biggest resources project since 2011 when the LNG projects were sanctioned.”

Mines Minister Anthony Lynham said Arrow Energy proposed to use nearby existing QGC infrastructure including processing facilities and pipelines to transport gas to domestic and export facilities.

“This approach has two major benefits: it will get gas to the market faster and it significantly reduces the project footprint and the potential impact on local communities and the environment,” Lynham said.

The Queensland Resources Council has welcomed the government’s approval of Arrow’s petroleum leases for the Surat gas project, with CEO Ian Macfarlane saying it would result in more jobs, and higher royalties for the region.

“The go-ahead for Arrow Energy’s project in the Surat is a significant commitment of confidence in the Queensland gas industry and a sizeable investment from the private sector.

“More gas being produced is good news for all gas customers, both domestic and export.

“The development of our state’s gas industry is in stark contrast to the inaction of other states, where opportunity for investment and jobs are being squandered,” Macfarlane said.

Queensland’s next major gas project to start production will be Senex Energy’s domestic-only Project Atlas near Wandoan and Miles, with first gas forecast to flow by the end of the year.

Other recent major gas expansions are Shell QGC’s, the A$500-million Project Goog-a-binge and the A$1.7-billion Project Charlie, which together created about 2 000 jobs.

Gladstone LNG also announced a A$750-million investment in its Roma East Gas project last year and A$450 in investment to develop the Arcadia fields, creating another 700 jobs.