Cooper Energy and Japan’s Mitsui acquire BHP’s Minerva gas plant in Victoria

BHP has sold its Minerva gas plant in Victoria to Cooper Energy and Japan’s Mitsui for a small, undisclosed sum.

Origin's nearby gas processing plant. (Stuart McEvoy/The Australian)

BHP Billiton has sold its Minerva gas plant near Port Campbell in Victoria to the rapidly expanding Cooper Energy and Japan’s Mitsui for a small, undisclosed sum, in a move Cooper says could provide more gas to tight east coast markets.

Cooper, Mitsui and AWE (which is in the process of being completely acquired by Mitsui) have agreed to buy BHP’s (BHP) 90 per cent interest in the Minerva plant, but not the associated declining Minerva field in Victoria’s offshore Otway Basin.

Cooper already owns 10 per cent of the plant and field, which it acquired from Santos in 2016 with other assets including an interest in the Sole gas field in the Gippsland Basin.

After the deal, Cooper will own 50 per cent of the Minerva plant and Mitsui/AWE will own the rest.

“Our analysis indicates the plant can offer a highly competitive processing option for gas from Casino Henry and other gas fields in the region,” Cooper managing director David Maxwell said.

“Ownership of the plant has clear strategic merit and can significantly further enhance the economics of Otway Basin gas development and production.”

Cooper and Mitsui/AWE are 50-50 partners in the Casino Henry development in the Otway Basin, where they plan to grow production from 12 petajoules last financial year to 22 petajoules in 2019-20.

Cooper is currently reprocessing old seismic data to identify Otway Basin targets for drilling next financial year.

The Minerva plant can process 150 terajoules of gas per day but is now only processing 40 terajoules as Minerva declines.

Very little value was planned on the Minerva field and plant when Cooper acquired its 10 per cent stake from Santos.

At the time, it attributed just $206,000 of value for the 10 per cent stake, with $3.3m of plant value and $2m of field value offset by a $5.1m rehabilitation provision.