Santos buys controversial Hunter Gas Pipeline project

A controversial gas pipeline project stretching from Queensland to Newcastle has been bought by energy company Santos. 

The Hunter Gas Pipeline Project, spearheaded by Weston Aluminium director Garbis Simonian has been bought by the company who says the project would help deliver gas from its other project the Narrabri coal-seam gas project.

That project will deliver more than half NSW’s gas demand once it’s fully operational.

Santos also said they want to make the unbuilt Hunter pipeline project hydrogen compatible as customer demand evolves during the energy transition.

A price wasn’t put on the purchase in Santos’ statement to the ASX yesterday, but a 700-kilometre stretch of the pipeline project has been estimated in the past to be costing $1 billion.

Santos’ Midstream and Clean Fuels President Brett Woods said the acquisition provides a pathway for the delivery of gas from the Narrabri Gas Project to the domestic market, subject to a short connection to the main pipeline, which is currently in the planning phase.

“At a time when the ACCC is forecasting domestic gas shortfalls, our Narrabri project, which is 100 per cent committed to the domestic market, will inject new supply into southern domestic markets and put downward pressure on gas prices for New South Wales businesses, manufacturers and families,” Mr Woods said.

“It will make more gas available to cover peak demand periods, especially in circumstances where gas power generators are called on unexpectedly to replace wind, solar and coal outages, as we have seen this winter.

“Acquiring the Hunter Gas Pipeline route is an important step for the Narrabri project, with appraisal drilling planned later this year, pending various native title and environmental management plan approvals.

The Hunter Gas Pipeline already has planning approval.

“The route of the underground pipeline was specifically chosen to ensure minimum impact on communities, landholders and the environment, but there is room to make further improvements as needed,” Mr Woods said.

“There are also offtake points at several regional towns along the route to Newcastle, providing a new opportunity for gas supply to power generators, manufacturers, businesses and households in the Hunter region.”

“The cheapest gas supply will always be the gas on your doorstep because that reduces transport, storage and other handling costs. We will work in partnership with landholders and the local councils that represent communities the pipeline will traverse, to deliver new gas supply to domestic markets and maximise social and economic benefits of both the Narrabri Gas Project and the Hunter Gas Pipeline.”

Subject to receiving remaining government approvals, construction of the pipeline is expected to commence in early 2024.

The Hunter Gas Pipeline doesn’t have everyone on side though, many residents who live along the proposed route are very against the project and continue to fight to have it stopped.

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