The remaining deals for gas sales from the Sole field offshore Victoria will come into force on January 1, project operator Cooper Energy said on December 30.

Gas from Sole flows to the Orbost gas processing plant operated by APA Group. There are long-term contracts in place with utilities and industrial customers for a total of 19.75 petajoules/yr beginning in 2021, or 54 terajoules/day. Take-or-pay obligations cover 90% of the contracted annual volume.

With the remainder of these agreements starting in the new year, most of Sole's gas will be sold at agreed term contract prices, Cooper said. Until now the bulk of the gas was sold at lower spot prices, less transportation costs, with revenue and costs shared between Cooper and APA under a transition agreement announced in August.  

The Orbost plant restarted earlier this month after a long period of underperformance. The plant's operations were impaired by foaming in the absorber section of the sulphur recovery unit.  Analysis and review are being undertaken to determine the root cause of the foaming, Cooper said. 

To ensure it meets its supply obligations, Cooper said it had back-up arrangements in place. Under their transition deal, APA will contribute to the cost of some of these arrangements if there is a shortfall. Cooper will earn a comparable net cash margin as if all the gas had been processed at the Orbost plant, and a greater cash margin than if supply had been at anticipated near-term spot gas prices, it said.