Pipeline sale

Oil and gas play Beach Energy is in early talks to convince partners to examine a possible sale of valuable processing and pipeline infrastructure in the Cooper Basin in a move that would generate many hundreds of millions of dollars of proceeds.

New chief executive Rob Cole said that while the idea was "embryonic", he saw an opportunity to realise value from a deal that could involve divesting infrastructure to a party that would operate the facilities as a multi-user hub.

"We would like to realise value from strategic infrastructure," Mr Cole said, pointing to significant investments by the Cooper Basin partners in processing facilities at the Moomba oil and gas plant in South Australia's north, flow lines and larger pipelines.

"We intend pursuing opportunities to realise value from these assets."

Mr Cole's comments came as Beach reported a 44 per cent drop in March quarter revenues from a year earlier to $131 million, dragged down by lower oil prices and production.

They also signal that Beach favours a sale that would go well beyond the 659-kilometre Moomba-Port Bonython oil products pipeline that has long been considered by bankers and analysts as a candidate for sale by the South Australian Cooper Basin venture.

MOOMBA PLANT
Beach owns 20.2 per cent of the Moomba plant, which can process 380 terajoules a day of gas and 35,000 barrels a day of oil and condensates, as well as 600 tonnes of liquid petroleum gas. It also has storage for about 70 petajoules of gas. The Moomba-Port Bonython lines can carry 35,000 barrels a day of oil and gas liquids.

The facilities are operated by Santos, which is already studying potential asset sales to ease pressure on its balance sheet, and Origin Energy also owns a stake. The Port Bonython facilities and pipeline cost about $450 million to build, according to Santos.