Beach in $600m Alinta deal

BEACH Petroleum has struck a 15-year $600 million deal with Alinta to supply gas to Tasmania for power generation.
The oil and gas explorer will supply 225 peta joules of gas, beginning in 2009. Based on current Victorian gas prices the deal is worth an estimated $600 million in revenue terms over 15 years to Beach Petroleum.
Beach Petroleum's managing director Reg Nelson said the agreement helped position the company as a major gas producer. He said in terms of size of reserves, Beach Petroleum would sit in fourth place behind Woodside Petroleum, Origin Energy and Santos. "Beach's emergence as a significant gas producer has now been cemented," Mr Nelson said.
"We now supply substantial quantities of gas to Sydney, Adelaide, Canberra and Brisbane. "This will now lock us into the supply of gas to Tasmania and meanwhile we are back exploring for gas in offshore Victoria with a view to providing Victoria with gas." The gas sales agreement with Alinta is also expected to help fund the $500 million expansion of the company's Basker Manta and Gummy fields projects in Bass Strait. Beach Petroleum is the 50 per cent owner of the Basker Manta and Gummy fields with the remaining 50 per cent owned by the operator of the project, Anzon Australia. The gas will be used by Alinta to supply the first private sector power station, Tamar Valley Power Station, in Tasmania. "Construction of the gas pipeline and facilities will give impetus to fresh evaluation of 3D seismic data to follow up other exploration opportunities in the vicinity of the Basker Manta and Gummy fields, notably the Chimaera prospect immediately north of the Manta field and extensions to Manta itself," said Mr Nelson.