Santos to divert gas to east coast
SANTOS and its joint venture partners at the Gladstone LNG project in Queensland have agreed to divert about 30 petajoules of gas to the domestic market in an effort to stave off government export curbs.
The gas, which would have been exported, will instead be sold to customers on the east coast over 2018 and 2019, Santos said.
“Over the last few months, Santos has been working constructively with the federal government and our GLNG partners to supply additional gas to the east coast domestic market,” Santos chief executive Kevin Gallagher said.
The oil and gas producer has been accused of contributing to the tight gas supply situation in the domestic market, given its reliance on thirdparty supplies to fill up export shipments at Gladstone.
Earlier this year, the Federal Government introduced a mechanism giving it powers to impose export controls on companies when there is a shortfall of gas supply in the domestic market, following warnings of potential shortages by the regulator. The policy has been slammed by large energy companies, including Santos, as government interference in the sector.
Last month, Santos agreed to supply 15 petajoules of gas to the Pelican Point power station in South Australia and also committed to the supply of up to 72 PJ of gas over four years into the south-east market through a swap agreement.