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WestSide close to gas sale at Meridian
By Angela Macdonald-Smith, 12 February 2014, The Australian Financial Review

Queensland coal seam gas player ­WestSide Corporation is closing in on a gas sales deal that could breathe new life into its Meridian project and set it on a path to expansion. Chief executive Mike Hughes has pointed to advanced negotiations with large gas buyers, that could see Meridian gas sold to either one of the Gladstone LNG export projects, or to a portfolio player in the domestic market.

A contract to AGL Energy starts to expire in April, with the rest rolling off at the year-end. That leaves the Meridian's gas, which is 49% owned by Mitsui, uncontracted in an east-coast market where prices are on the rise. The Meridian venture's 680 petajoules of proven and probable reserves is the biggest chunk of gas available ­outside the LNG ventures. While Meridian has capacity to produce 30 terajoules a day, production has been running at about 15 terajoules daily. But Mr. Hughes said the venture offers the option for a cost-effective brownfields expansion, with more drilling and additional compression. He added that the expected deal, likely to be agreed within three months, would give some flexibility over ­volume, with prices potentially around the $8 a gigajoule level which was ­typical of recent contracts.