PERTH (miningweekly.com) – The Mereenie joint venture (JV) partners will proceed with the development of the gas project, in the Northern Territory, after the Australian Competition and Consumer Commission (ACCC) granted interim approval for joint marketing arrangements.
The ACCC authorisation allows developers Central Petroleum and Macquarie Mereenie to begin negotiating joint supply agreements with customers, pending a final determination.
The JV partners have agreed to further limited drilling at the Mereenie gas field and an immediate A$12-million upgrade to the processing plant, which will increase the capacity from the current 25 TJ/d to 63 TJ/d.
Some 58 TJ/d of this will be sold as gas, without adversely affecting current crude oil production.
Central Petroleum said on Monday that, given the delay in the start of drilling, the JV partners felt the best use of funds would be to drill one Stairway well and use the funds earmarked for the second Stairway well for a larger-than-envisaged plant upgrade at Mereenie.
The company noted that the decision to develop Mereenie’s gas potential coincided with the Northern Gas Pipeline (NGP) becoming operational.
“Ideally, the plant upgrade decision should have been made in February to ensure the work was completed by the time the NGP became operational,” said Central Petroleum MD Richard Cottee.
“But Central was never, nor should it be, in control of regulatory approvals and while it will be tight, Central as operator will use every endeavour to ensure the Mereenie processing plant has the capacity to sell 58 TJ/d of sales gas by the end of this year.”