The truth about the Walyering daily production rate might be...

The truth about the Walyering daily production rate might be different to your assumptions...

The current rate of 20 TJ/d is exactly the daily minimum obligation from the initial GSA with Santos WA:

"The Santos Gas Supply Agreement is for the supply of 36.5 PJ over a period of 5 years on a firm, take-or-pay basis at 20 TJ per day with arrangements for supply of additional gas on an ‘as available basis’"

(Source: Oct 9/23 ana)

The two important technical information's from yesterdays announcement are:

1. Strike successfully delivered 33 TJ from the Walyering gas field into the Western Australian domestic gas market on the 24th of December 2023.
2. Upstream performance from the Walyering gas field has been in line with expectations, and all reservoirs have now been opened and the original downhole gauges retrieved.

These two points basically are meaning that the two Walyering wells are fully brought to production and the production facility can deliver at least a rate of 33 TJ/d.

(Just to support your understanding of yesterday's anna: the reference to "several periods of downstream maintenance on the Parmelia Gas Pipeline, which limited deliveries into Strike’s existing marketing arrangements" only explains why it took until Dec 24th to reach this important milestone.)

The new GSA with Alinta Energy from Feb 2024 will increase our daily production by about 9-10 TJ/d. Hence, we will see production rates of 29/30 TJ/d in Feb.

We can assume that the new GSA will sell the Walyering gas at better terms per GJ compared to the initial GSA with Santos from Dec 14 2022. And therefore, the current production of 20 TJ/d is due to the optimization of the Walyering gas sales value by Strike (and not due to any pipeline issues...).

Importantly, Stuart is quoted with: "With the confidence that Walyering can operate steadily at these rates (remark: 33 TJ/d) or higher, Strike will increase its gas marketing activities [...]"

My take from this is, they can expand the production capacity of the facility above the 33 TJ/d and Walyering will be a prolific cash generating facility for years...