Santos has signed an agreement with ENGIE in Australia to supply gas to the Pelican Point Power Station in South Australia.
The contract, starting in January 2018, is for 15PJ and the contract will be fulfilled with a mix of GLNG gas and Santos portfolio gas.
Santos managing director and chief executive officer Kevin Gallagher said energy security for South Australia was a priority and the agreement demonstrated the company’s willingness to work with its GLNG partners – Santos, PETRONAS, Total, and KOGAS – to reach a positive outcome.
In a report released in June, the Australian Energy Market Operator (AEMO) identified the resumption to full service of Pelican Point Power Station as critical to supporting South Australia’s electricity needs.
“It also shows we are working with the Turnbull Government to deliver affordable and reliable energy to all Australians, and as a leading domestic gas producer across this country, Santos is best placed to bring energy security to Australian households and businesses,” Mr Gallagher said.
“This agreement demonstrates that Santos is delivering for Australians, and that natural gas has a crucial role to play if Australia is going to have a balanced and pragmatic approach to energy policy.
“It also reflects the strong relationship we have with ENGIE in Australia and the important role played by our GLNG partners in reaching an energy solution.”
In the coming months, Santos will announce further domestic supply contracts to support the federal government’s efforts to deliver affordable and reliable energy to households and industry.
APPEA chief executive Dr Malcolm Roberts said that Santos’s announcement, following recent gas supply announcements by Shell Australia and Origin Energy, shows the gas industry is meeting the needs of its domestic customers.
“This ENGIE agreement, coupled with other actions the industry has taken since March, shows gas producers are delivering,” he said.
Dr Roberts said that the only sustainable way to meet gas demands for exports, domestic manufacturing, and energy generation is to increase supply.
“This is where all governments should be focused,” he said.
“Some states need to decide whether they wish to be part of the problem or part of the solution.
“It is absurd that we are talking about the possibility of a supply shortfall in 2019 when we have substantial resources in the Northern Territory, Victoria and New South Wales that could be developed.
“Today’s announcement provides further evidence that market interventions, such as the Australian Domestic Gas Security Mechanism, are unlikely to