Empire Energy Group has revealed a new deal with infrastructure specialists APA Group to progress gas transport solutions for its Carpentaria gas project in the Northern Territory. The company says it is now planning two stages of development for the project, which has the potential to service the Top End and east coast of Australia with more than 500 terajoules of power per day.
Empire Energy Group has revealed a new deal with infrastructure specialists APA Group to progress gas transport solutions for its Carpentaria shale gas pilot project in the Northern Territory’s Beetaloo Basin.
The company says it is planning two stages of development for midstream gas infrastructure at the project, which it says has the potential to service the Top End and east coast of Australia with more than 500 terajoules of power per day.
The pilot project’s first stage will see early works to facilitate the construction of gas gathering, processing, compression and associated midstream gas infrastructure aimed at meeting a sales production rate of up to 25 terajoules a day. The project will utilise the existing McArthur River and Amadeus gas pipelines to service the town of Daly Waters and the McArthur River Mine, in addition to Darwin, Alice Springs and regional centres in the NT.
APA will fund the infrastructure facilities construction with up to $5 million, materially reducing Empire’s capital requirements to start commercial production. The company says it is targeting a final investment decision for the pilot project later this year and is aiming for first gas sales in the first half of next year.
The second stage of development will see early works kick-off on the lead concept, which proposes the construction of a new Beetaloo sub-basin gas pipeline. It would connect the Carpentaria field to Australian east coast gas markets by bridging the gap from APA’s existing Carpentaria pipeline, which runs 840km from Mount Isa and Ballera.
Empire says the initial agreement envisages APA funding the new pipeline, subject to entering long-form agreements and believes it could expand to meet growing market demand for gas on the east coast – estimated to be in excess of 500 terajoules per day.
The partnering agreement would also see Empire grant APA exclusive rights to develop and execute its midstream gas infrastructure projects. In exchange, APA would become a foundation customer in any multi-user pipelines exporting gas from Empire’s Beetaloo sub-basin assets.
Empire Energy Group managing director Alex Underwood said: "APA, Australia’s leading energy infrastructure business, has demonstrated its desire to connect the Beetaloo Basin to customers both domestic and international, underwriting Australia’s energy security. This agreement is a result of the substantial progress in resource development Empire has achieved since the MOU, announced in October 2021. APA potentially funding the midstream gas infrastructure facilities for Empire’s Carpentaria Pilot Project, reduces the capital requirement to Empire, enhancing project economics.”
APA is an Australian company that owns, manages and/or operates a $22 billion portfolio of gas, electricity, solar and wind assets. The company delivers about half of the nation’s natural gas usage and operates a vast electricity transmissions network connecting Victoria with South Australia and New South Wales with Queensland.
Empire’s Carpentaria project sits within exploration permit EP187, which the company has assigned a best-estimate contingent resource of 1739 petajoules, a low-case estimate of 304 petajoules and the high-case at 3507 petajoules. Due to the high calorific value of the low carbon dioxide gas within the permit – estimated at 1.15 terajoules per million standard cubic feet of gas – the amount of gas is expressed in energy units rather than the more typically-seen volumetric units.
With 1 petajoule capable of powering 19,000 homes for a year, the gas within EP187 could represent a major transformative power solution for Australia’s east coast.
Empire has drilled four wells within EP187 – Carpentaria-1, 2H, 3H and 4V. Carpentaria 1 and 4V are vertical holes, while Carpentaria 2H and 3H were drilled from the same surface location and are horizontally-deviated in opposite directions to target the relatively flat-lying shale reservoir intervals at about 1600m below the surface.
The Carpentaria-3H well was last week re-opened for production testing after a five-month shut-in and soak to allow fracture stimulation to take full effect. The company says production testing will take about 90 days and hopes to observe increased gas flow rates similar to those at Carpentaria-2H, which showed a post shut-in 17 per cent increase.
With the Australian east coast gas shortage forecast to reach 30 petajoules this year, Empire seems to be in pole position to help fill the gap. Now, the market will await the results of the Carpentaria-3H production test to see just how much gas the company’s shales are holding.
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