Central Petroleum Ltd., Brisbane, signed agreements for the sale of 3.5 petajoules of gas from fields in the Amadeus basin in central Australia over 2 years plus a 12-month extension of its loan facility with Macquarie Bank Ltd.
Funds from a lump sum payment Dec. will be used to pay the company’s share of costs associated with recompleting four existing wells to produce gas currently behind pipe along with the drilling of new crestal production wells in Mereenie field in 2021, Central said.
The drilling and recompletion program aims to return the gross production from Mereenie to more than 45 terajoules/day, delivering a total incremental volume of about 40 petajoules. The wells will be brought on stream in 2021.
Under the gas agreement, Central will supply the gas to Macquarie (or its nominee) during 2022 and 2023.
The agreement removes Macquarie’s existing option to purchase additional gas in 2022 and 2023 under a previous agreement signed in May 2016 in which 5.2 petajoules of gas was sold for delivery over 2019, 2020, and 2021. Thus, the new agreement essentially continues gas deliveries to Macquarie at the same rate for a further 2 years.
The loan agreement will extend the term of Central’s $69.8 million (Aus.) finance facility to Sept. 30, 2022.