Magellan signs long-term gas supply deal for Dingo field

Magellan Petroleum Corp. has signed a deal with Northern Territory Power & Water Corp. for long-term supply of gas from Dingo field in the Amadeus basin in central Australia.

The 20-year contract ensures the supply of as much as 30 bcf of gas to NTPWC on a take-or-pay basis.

Gas will begin to flow in early 2015 at a fixed but undisclosed price, which will escalate with the Australian consumer price index.

Magellan will soon begin design, construction, and commissioning of the surface facilities at Dingo as well as a tie-in pipeline to the main central Australian trunk line from Alice Springs to Darwin.

Currently the work is in front-end engineering and design stage.

Dingo was discovered in 1981 about 60 km south of Alice Springs and southeast of the larger Palm Valley gas field. Reserves were fixed during a four-well exploration-appraisal program during the 1980s and 1990s, but with no customer demand till now the field has lain dormant.

Magellan will produce gas from three of the four wells.