Page 7 - AsiaElec Week 30

AsiaElec COMMENTARY AsiaElec

Victoria’s second quarantine effort with some the upgraded plant will eventually become a gas
trepidation. While a recovery in gas demand processing hub for the offshore Otway Basin.
may take some years to reach previously pro- First gas is anticipated in the current quarter,
jected levels it is still unclear how the pandemic though Cooper has said uncertainties stemming
will affect future domestic East Coast supply from coronavirus (COVID-19) could delay that
projects. timetable.
Cooper, however, is betting on the current
projected supply and demand imbalance, hav- What next
ing signed off this week on the Minerva Gas The Australian upstream has been hit hard by the
Plant project alongside Japanese partner Mitsui. downturn, with Woodside Petroleum, Santos,
Origin Energy and Oil Search having all issued
Project potential impairment charge warnings.
Cooper said on July 20 that the two firms The industry is trying to find its footing amid
would spend a total of AUD55mn ($39.2mn) continued local and international economic
on upgrading of the plant, including the uncertainty. The sector faces a challenging near-
AUD17.8mn ($12.7mn) the 50:50 partners spent term future in which it has to make investment
not only on acquiring it in December 2019 but decisions in a volatile political and economic cli-
also on carrying out subsequent front-end engi- mate overshadowed by unpredictable govern-
neering and design (FEED) work. ment responses to unexpected viral outbreaks.
Cooper said the investment would allow the With no clear idea of when the global health
plant to process gas produced from the existing outlook will stabilise, and talk of a vaccine little
Casino, Henry and Netherby fields in the VIC more than a panacea for public anxiety at this
L24/L30 licence, which Cooper and Mitsui point, making any long-term investment deci-
jointly own. The partners will invest AUD37mn sion is an incredibly tricky task. In this light,
($26.4mn) in the plant’s upgrade. Cooper’s decision to commit to a new supply
Minerva’s revamp should pave the way for project targeting domestic gas demand speaks
16 PJ (416.78 bcm) of currently undeveloped to a continued confidence in AEMO’s market
gas to be processed, with the company saying forecast. ™

Week 30 29•July•2020 www. NEWSBASE .com P7