PERTH (miningweekly.com) – ASX-listed Senex Energy has inked a gas sales agreement with zinc miner New Century Resources for the sale of 7 PJ of natural gas over a three-year period.

Senex on Thursday announced that the natural gas would be supplied to New Century at the Diamantina power station in Mount Isa, generating the power required to operate the Century mine.

The Diamantina power station is owned and operated by APA Group.

Under the three-year agreement starting January 2022, Senex will provide around 7 PJ of natural gas to support New Century’s processing operations at a fixed price, in line with current market levels. Senex will further supply around 1 PJ of additional natural gas at New Century’s election by mid-2022 in support of material increases in production levels associated with the potential development of existing in-situ deposits at the Century mine.

Senex MD and CEO Ian Davies said the company was proud to supply a strong regional Queensland customer with natural gas from its Queensland operations.

“Century mine generates significant state royalties and export earnings and is a critical project in the Queensland government’s Strategic Blueprint for the North West minerals province.

“Senex looks forward to building another strong, long-term and mutually beneficial relationship that supports jobs, the economy and helps meet Australia’s energy demand as it transitions to a lower carbon future.“Senex also acknowledges APA as an important part of the value chain delivering energy to Mount Isa,” Davies said.

This is the tenth major natural gas supply agreement announced by Senex since 2019. Senex has signed more than 75 PJ of agreements with customers including Adbri, CleanCo Queensland, CSR Building Products, Opal, Orora and Visy Glass.

The Australian Petroleum Production and Exploration Association (Appea) has welcomed the new gas agreement between Senex and New Century.

“Gas means jobs. Gas means reliability. Gas means a bright future for regional Queensland. Gas has showed how reliable it is throughout the pandemic and with the breakdown of other energy sources, the industry has continued to do the heavy lifting to ensure the lights are kept on, factories kept running and that there is no gas shortfall in the domestic market,” Appea CEO Andrew McConville said.

“The market is clearly working with competitively priced gas continuing to deliver for Australia. Domestic users are paying less for Australian gas over the long term than overseas markets and have been doing so for some time.

“The gas being supplied to the region is vital for the development of the Queensland government’s Strategic Blueprint for the North West minerals province.”