Highlights of Santos and Origin’s move on gas supply support in domestic market

A new deal to supply ethane gas to the Chinese-controlled plastic maker, Qenos, has been signed by Santos and Origin. The supply of an estimated 27 petajoules (PJ) will be made to Qenos for the remainder of 2017 until the end of 2019. It is emphasized that the gas is not only a clean, reliable energy source, but is also an important constituent for manufactured products. The deal represents the following key aspects:

1.       Strengthening the support for Australia’s manufacturing industry: The new agreement aims to continue the support from the two Energy players for the manufacturing industry through the supply of ethane gas to Qenos, which is Australia’s sole producer of polyethylene and a supplier of world class polymers. The ethane is processed at Santos – operated Moomba gas plant and piped to Qenos operations at Botany Bay in Sydney, and is used as a feedstock in the manufacture of polyethylene.

2.       Meeting domestic demand: Santos has lately advised that GLNG joint venture partners will divert a further 30 PJ of gas into the domestic market in 2018/19. The group has also signalled about few recent transactions in the last couple of months which will see about 100 PJ being supplied into the domestic market from GLNG partners and Santos.

 

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