How are Shell and PetroChina Further Investing in Australia?
A 50/50 joint venture between Shell and PetroChina, Arrow Energy was formed in 1997 to be the most competitive and respected developer of unconventional gas value chains in Australia.
Surat Gas Project
Safely and sustainably developing coal seam gas in Queensland Australia since 2000 and supplying commercially since 2004, Arrow Energy primarily operates in Surat and Bowen.
In particular Arrow Energy – following a deal made in December 2017 – has been investing in the Surat Gas Project (SGP), a world-scale project to commercialise most of its Surat Basin gas reserves – roughly five trillion cubic feet.
The first phase of the project was sanctioned in April 2020, taking advantage of existing QGC-operated infrastructure to reduce its impact on landholders and communities.
Phase one included more than 600 wells to be drilled focusing on the Daandine and Tipton areas, as well as the construction of Inlet Processing Facilities (IPFs) at Shell-QGC. Phase one also included upgrades and connection to water treatment facilities and constructing two new brine storage ponds.
- A natural gas, trapped in underground coal seams by water and ground pressure
- Its single largest component is methane
- CSG is used for home cooking and heating, to generate electricity, and to make industry products
- Arrow has supplied CSG commercially to the Queensland domestic market since 2004
Phase 2 of the Surat Gas Project
Announced by Shell and PetroChina, the SGP will begin to develop its second phase. As part of an existing 27-year gas sales agreement between Arrow Energy and GQC, the gas from the project will flow to the Shell-operated QCLNG facility on Curtis Island to meet long-term contracts and supply domestic customers.
Phase 2 is expected to contribute around 22,400 barrels of oil equivalent per day at peak production.
“Embarking on Phase 2 of the Surat Gas Project with Arrow is part of our commitment to bring more gas to market," said Zoë Yujnovich, Shell’s Integrated Gas and Upstream Director. “QCLNG marked its 1000th cargo at the end of last year, reflecting its significance as a gas supplier for Australia and the region. This investment will enable us to sustain and grow this important, secure energy source that offers a lower emissions alternative to options like coal”
Shell also plans to secure further feed gas supply for its existing LNG facilities through additional backfill projects to increase value for shareholders. First gas is expected in 2026.
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