A number of projects in the eastern states, recently commissioned to expand network capacities in order to respond to this predicted shortfall, are nearing completion.
Among such projects is the expansion of the Jemena-operated 797 km, 168-610 mm diameter Eastern Gas Pipeline (EGP), which transports gas from Victoria’s offshore Gippsland Basin to Sydney, the Australian Capital Territory (ACT) and regional New South Wales (NSW).
The project will see Jemena expand the EGP by 20 per cent and install two new midline compressor stations in East Gippsland and Michelago, and construct additional delivery facilities.
Jemena is expecting the $150 million expansion project to be completed by the start of 2016.
The EGP, constructed by a joint venture between Transfield Willbros and Macmahon in 2000, is a vital link in the east coast gas market, transporting more than half the gas consumed in NSW.
The expansion will allow the transportation of at least an additional 22 PJ of gas per annum into NSW.
New GTA announced
A Gas Transportation Agreement (GTA), commencing in 2016, to support the expansion was signed in May 2015 between Jemena and AGL Energy Limited, which has purchased capacity on the EGP for the next 15 years.
The EGP also feeds into Jemena’s distribution network which delivers natural gas to more than 1.2 million homes and businesses across Sydney and regional NSW, a fact not lost on Jemena Managing Director Paul Adams who identifies NSW as a critical market for the company.
Mr Adams said that the GTA has deepened Jemena’s longstanding partnership with AGL, and brings much-needed additional gas into the state.
“Demand for gas in NSW remains strong, despite some potentially challenging conditions in the short term. Expanding the EGP now means we’ll be ready to move more gas into the market and help offset projected supply and price pressure for customers,” said Mr Adams.
“With the EGP primed to deliver more gas into NSW at a competitive price, we are also proposing to lower our distribution charges for the majority of our customers by 40 per cent in real terms over the next five years, encouraging them to continue to utilise gas while the market adjusts to new economic conditions.”
Mr Adams added that Jemena has invested approximately $180 million in gas transmission assets over the past few years, aimed at increasing capacity and developing new delivery points to offer its customers reliable gas transportation and storage options.
“We’re focused on continually expanding and improving our transmission infrastructure so we can make the most of opportunities from onshore gas development and gas exports,” said Mr Adams.
“Gas production, consumption and exports are all forecast to grow over the next two decades, which means there are real prospects to expand the existing transportation network and build new infrastructure to link new gas developments to established markets.”
Commissioned in 2000, the EGP has undergone recent expansions which saw the addition of a midline compressor station near Mila, NSW and the installation of a fourth compressor at Longford in Victoria.
