APA to Build 450-km Gas Pipeline for Santos

Australian gas infrastructure player APA Group has signed an agreement with Santos to build a 450-km gas pipeline from Santos’ proposed Narrabri gas project in New South Wales to connect to the existing APA owned East Coast Grid through the Moomba Sydney Pipeline at the Bundure mainline valve station, some 100 km west of Condobolin.

APA will build and own the pipeline, at a total construction cost of around A$500mn (US$380mn). It will soon begin a comprehensive regulatory approval process with the submission of a preliminary environmental assessment (PEA) to the NSW Department of Planning and Environment, APA said January 31.

APA Group CEO Mick McCormack said: “This is an important agreement in terms of its potential to significantly increase the supply of natural gas to the eastern Australian market in the medium to long-term, particularly for New South Wales.”

Narrabri gas project has been mired in controversy. Early last year, 98 shareholders, representing about 0.019% of the company’s shares on issue, were among 104 signatories to a notice sent to Santos that Narrabri project be withdrawn from the company's portfolio and Santos start looking at investment in renewable energy.

"The Narrabri gas project threatens Santos' reputation and now that it is the sole coal seam gas project proposed for NSW makes Santos look like a rogue operator," the proposed resolution said.

Santos, however, rejected the call for the resolution to be put before shareholders. According to Santos, the proposed Narrabri Gas project could supply NSW homes, small businesses, major industries and electricity generators with up to half the state’s natural gas needs.

In August 2016, NSW Land and Environment Court dismissed a case that Santos’ main wastewater treatment plant had been constructed without necessary approvals.

Shardul Sharma