Strike Energy Ltd. executed a processing services and liquids aggregation agreement with Santos Ltd. for condensate produced from Walyering gas field in the North Perth basin of Western Australia for delivery to the Santos-operated export terminal at Port Bonython on Spencers Gulf in South Australia.
Due to the high quality of Walyering condensate, premium pricing to the Brent market price is forecast, Santos said.
Annual gross revenues from a 250 b/d production rate are expected to be over $10 million (Aus.) (assuming average Brent price of US$75/bbl over the period), the company said.
Breakeven of the Walyering gas by-product will be US$45-50/bbl, including the cost of trucking product to South Australia from Western Australia, as well as production costs, the company continued.
Walyering lies in permits L23/EP447 in North Perth basin, about 2,500 km from Port Bonython by road across the Nullarbor Plain.
Strike said construction on the Walyering project is progressing with foundations and prefabricated footings dug and installed. Pipework and vessels are being placed on site.
Construction is preparing to move to a 24/7 operation and the project remains on track for start-up before end-June.
Walyering was sanctioned as a 33 terajoules/day gas and 250 b/d condensate plant following field appraisal with Walyering-5 and -6 wells that delineated a gross 54 petajoules of 2P reserves and gross 32 petajoules of 2C contingent resources plus about 0.8 MMboe associated condensates.
First gas sales are expected to begin soon with 35.5 petajoules of gas being sold to Santos on a firm basis over 5 years.
Strike is operator with 55% interest. Talon Energy Ltd. holds 45% interest.