Australian LNG player Santos said on Wednesday it has signed a new long-term natural gas supply agreement with Brickworks Limited for its east coast operations through to the end of 2024.
The natural gas contracted to Brickworks will supply its east coast operations in South Australia, Victoria, Queensland and New South Wales.
Santos will supply up to 15PJ of natural gas over the life of the agreement from fields in the Cooper Basin.
Santos Managing Director and CEO Kevin Gallagher said this natural gas supply agreement “is another demonstration of Santos’ commitment to secure the future of Australian manufacturing jobs.”
“Santos is actively participating in the wholesale commercial and industrial market on the east coast, adding to competition in the domestic market and helping deliver more competitive natural gas prices and terms for Australian industry,” Gallagher said.
Since 2015 Santos has reduced connected well costs in Queensland by 84 per cent and completed well costs in the Cooper by 50 percent to become Australia’s lowest cost onshore natural gas developer, the company claims.
“Drilling more wells and lowering production costs – extracting more gas for less money – is the best way to keep downward pressure on gas prices,” Gallagher said
Santos added that it is on track to supply about 70 PJ of gas to the east coast market in 2018, which is almost 13 percent of expected demand this year.