Energy World Corp. Ltd., Hong Kong, has finalized an agreement with the Australian government under which the government will provide as much as $2 million (Aus.) in funding to be used to accelerate the recommissioning of two gas fields in southwest Queensland.
The funding, provided under the Gas Acceleration Program, will be directed to EWC’s wholly owned Eromanga and Gilmore fields that were put into a care and maintenance program in 2001.
The fields have a total of 31 bcf of natural gas resources. In addition, EWC has recently acquired the remaining 80.4% share of nearby Thylunga field, which can be tied in to the company’s Eromanga processing plant. Thylunga has potential additional reserves from its two previously drilled discovery and appraisal wells.
EWC says each of its facilities has a throughput capacity of 12 terajoules/day. The facilities are connected to existing gas production wells and the broader Queensland gas pipeline system. The Eromanaga plant also can be used to unlock third-party stranded gas resources in the region.
An independent report has concluded that both the Gilmore and Eromanga plants are in reasonable condition and present no major impediments to plans to recommence production.
EWC Executive Director Brian Allen said the gas supply shortfall on Australia’s east coast has brought a rise in domestic gas prices and created the opportunity to recommission the facilities.
The terms of the government funding provide for an up-front payment of $500,000 followed by reimbursement of 50% of the amount EWC spends (after the first $1 million of expenditure), subject to meeting specified milestones.