Reindeer gas field development to proceed

The Apache Energy-Santos development of Reindeer gas field off Western Australia and the associated Devil Creek processing plant 45 km south of Dampier is back on track.

Rick Wilkinson
OGJ Correspondent

MELBOURNE, Jan. 7 -- The Apache Energy-Santos development of Reindeer gas field off Western Australia and the associated Devil Creek processing plant 45 km south of Dampier is back on track following Santos' signing of CITIC Pacific as the project's foundation gas buyer.

Under the $812 million (Aus.) contract, Santos will supply CITIC's Sino Iron magnetite mining project at Cape Preston 100 km south of Dampier with 75 petajoules (69.75 bcf) of gas over 7 years beginning in the latter half of 2011. The gas will be used as generation fuel for Sino's 450 Mw electric power plant now under construction.

Reindeer field, discovered in 1997 on permit WA-209-P, has reserves of 390-610 bcf of gas. The gas will be transported via subsea pipeline 105 km to the Devil Creek plant. Flow capacity will be about 215 terajoules/day (200 MMcfd). All the gas will be fed into the domestic market.

The project was deferred in December when Santos said there were delays in the execution of a gas sales agreement because of the poor financial climate.

Although Santos said the project is again viable, Clough Australia said it is still waiting to hear if its contracts for engineering, procurement, and construction of the Devil Creek plant and the offshore facilities at Reindeer will be reinstated.

Apache holds 55% of the project, and Santos holds 45%.

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