BY ELIZABETH FABRI
FORMER Santos chairman Stephen Gerlach has announced plans to build a $3 billion coal-to-gas project in the Northern Territory that could deliver gas to the east coast as early as 2022.
The proposed Andado project would be developed by Gerlach’s Ebony Energy to supply 50 petajoules (PJ) per annum of pipeline grade gas for more than 25 years.
In October, Ebony Energy completed the scoping study for the project, which included plans for an above ground coal-to-gas production plant; the first of its kind in Australia.
The plant will process coal mined from the Pedirka Basin into pipeline quality gas.
Ebony Energy has already signed a Memorandum of Understanding (MoU) with General Electric (GE) to supply the gasification and plant technology, and a subsequent MoU with OSD to develop and operate a 670km pipeline which will connect the plant to the Moomba gas hub in South Australia.
Mr Gerlach said at 50PJ of gas per annum, the project could meet about 8 per cent of the total east coast domestic gas demand, making it a “substantial contribution” to easing supply uncertainty.
“Andado is a landmark energy infrastructure project that on completion can contribute greatly to solving the east-coast gas supply and pricing, and demand adjustment issues we are seeing currently,” Mr Gerlach said.
“While we have yet to execute formal reserve assessment work, the nature of the production process gives Ebony a high degree of long term price certainty.
“Our initial 50PJ pa gas production plan requires only 4 million tonnes pa coal supply into the plant while Ebony’s tenement contains around 6 billion tonnes of mid energy, low ash, and low sulphur coal.”
Ebony said it was currently in search for funds to undertake additional work, and was preparing to list on the ASX in early 2018.
Its Initial Public Offering (IPO) has been designed to raise about $50 million to fully debt fund the project.
The company was also beginning off-take discussions with gas users looking for long-term supply.
“We believe the Andado Project represents a win-win-win proposition for energy security, the community and the environment,” Mr Gerlach said.
Andabo in focus
Cost: $3 billion
Location: 250km from Alice Springs, Northern Territory
Production: 50 petajoules (PJ) per annum
Operating life: 25 years +
Start date: From 2022
Jobs: 2000 during construction, 200 ongoing positions