Central Petroleum Ltd., Brisbane, is to start sale of early natural gas from Palm Valley field to Northern Territory Power & Water Corp. under an agreement previously struck with Magellan Petroleum Australia.
Central will provide 2 terajoules/day of gas from its share of Palm Valley field in advance of gas being available from nearby Dingo field, which is still under development.
Central says Dingo will be brought onstream in the second quarter.
The advance gas sales will be incremental to current gas production from Palm Valley, which is under a separate sales agreement with field operator Santos Ltd. It will provide an acceleration of gas revenue with a small incremental operating cost.
Central bought its share of Palm Valley and Dingo from Magellan a year ago and this included the sales agreement for Dingo (OGJ Online, Feb. 19, 2014).
That agreement is for 30 bcf of gas on a take-or-pay basis over 20 years from Dingo and requires construction of a 50-km gas pipeline from the field to Alice Springs.
Central says Dingo will be brought onstream under budget.
