Ann: Sole Gas Sales Agreements to commence on 01/01/2021, page-10

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Gas and cash to flow after fix at Cooper Energy, APA Orbost plant

DECEMBER 30, 2020

Cooper Energy and pipeline group APA say they finally have issues under control at their troubled Orbost processing plant in Victoria, saying gas is set to flow from the facility under long-term contracts from January 1.

The Orbost plant was designed to service Cooper’s Sole gas project, and output from a $250m upgrade to the plant conducted by APA was originally due to enter the market in mid-2019.

But ongoing problems with the plant forced multiple temporary closures and Cooper said on Wednesday it was finally in a position to begin supplying long-term contracts from January 1, after the plant was able to maintain stable output of 22.5 terajoules a day since December 9.

Cooper managing director David Maxwell said the start of the commercial contracts was a great relief to the company, which has been waiting on a fix at Orbost for the cash flow from its contracts to accelerate exploration at its other Victorian prospects.

“We’ll reinvest the cash flow together with debt facilities in further gas supplies for south east Australia, in the offshore Otway and offshore Gippsland,” he said.

He said the commercial launch of Orbost and Sole, the first new gas field developed offshore in south east Australia in a decade, would add more competitive tension into the market, although it will not add significantly to total supply available due to the rapid decline of ageing Bass Strait fields owned by BHP and Exxon.

But while Cooper and APA are celebrating the start of commercial contracts from Orbost, the gas producer noted some uncertainty remained around the long-term performance of the plant, noting APA had still not got to the bottom of the problems that have plagued the plant.