PERTH (miningweekly.com) – ASX-listed Strike Energy has partnered with gas infrastructure provider Australian Gas Infrastructure Group (AGIG) to build, own and operate a 50 TJ/d gas plant for Strike’s Phase 1 West Erregulla development, in Western Australia.

Strike on Thursday said that the project would represent an investment of more than A$200-million in infrastructure and services by AGIG under a competitively priced long-term tariff.

The long-term tolling arrangement will avoid substantial up-front capital for strike and will facilitate the company’s focus on the execution of the upstream wells and infrastructure, the company said.

“We are very pleased to be partnering with AGIG, a world-class operator of gas infrastructure for the development of Strike’s significant natural gas asset. We’re excited about the long-term future of the Western Australian domestic gas market, and with our forecast low cost of production, believe we are in a prime position to move forward with confidence at a time when many in our industry are deferring or cancelling projects,” said Strike MD and CEO Stuart Nicholls.

“AGIG has a long and successful history of operating infrastructure in the region and in building relationships with the area's land holders and stakeholders. AGIG owns and operates Western Australia’s critical Dampier to Bunbury natural gas pipeline, which connects domestic gas production in the north to the major Western Australian South West market.

“Strike is well positioned with the West Erregulla gasfield being located adjacent to the gas pipeline and in entering into this new partnership with the pipeline’s operator.”

The 50 TJ/d gas facility will be constructed adjacent to the West Erregulla gasfield with a raw gas trunkline connecting to the upstream development, and will process raw gas to sales specification before delivering it into the transmission network.

The Phase 1 infrastructure is being designed with low cost expansion opportunity to a larger Phase 2 development, including a 250 TJ/d capacity for the sales pipeline.