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Santos to supply 9PJ natural gas to New Century's zinc mine

EBR Staff Writer Published 16 February 2018

Santos has bagged an order of around A$100m ($79.86m) to supply natural gas to New Century Resources' zinc mine near Mount Isa in Queensland, Australia.

The Australian onshore gas operator will supply about 9PJ of portfolio gas over the next four years, which will be used to produce electricity for the Century Zinc Mine.

According to New Century, the long-term Gas Supply Agreement (GSA) will help the firm set up full-scale grid power generation for its operations.

Furthermore, the agreement will provide access to gas-fired power generation for the mining operations as opposed to the more expensive on-site diesel generation, said the base metal development company.

New Century utilities manager Michael Pitt said: “New Century is very pleased with the Santos GSA, which provides both the required gas supply volumes for restarting operations, but also significant flexibility during ramp up at the Mine.

“After a highly competitive tender process for the supply of gas, we are thrilled to have entered into a long term contract with our partners at Santos and look forward to a strong working relationship as we transition into full operations at Century.”

With the new order, Santos would take its total contribution in 2018 to the east coast domestic gas market to around 70PJ after combining existing agreements announced in 2017 and this year.

Santos marketing and trading executive vice president Phil Byrne said: “Santos is absolutely committed to working in partnership with Australian industry to deliver competitively-priced domestic gas and this is a great example of that commitment.

“Access to new and existing supply sources in Queensland as well as new sources in New South Wales and the Northern Territory is critically important to enable us to continue to deliver competitive gas for Australian industry on the east coast as mature fields decline.”

In December 2017, Santos along with GLNG partners had agreed to deliver 15PJ of gas in 2018 to Origin for the Australian east coast domestic market.

Image: Gas supply agreement signing ceremony at Santos Operational Control Centre, Brisbane. Photo: courtesy of Santos Ltd.