Vintage Energy opens gas taps on Vali field in AGL supply agreement

Vintage Energy has celebrated bringing its first gas production online, with the company turning on the taps under a long-term supply agreement with AGL.

Vintage Energy has celebrated bringing its first gas production online, with the company turning on the taps under a long-term supply agreement with AGL.

First gas from the Vali field in the Cooper Basin flowed on Tuesday, with Vintage managing director and former Beach Energy executive Neil Gibbins saying it was a great achievement just three years out from discovery.

“First production and first revenue generation is a landmark event for every company” Mr Gibbins said.

“For an exploration company to reach this point, let alone within four and a half years of floating, is noteworthy.’’

AGL pre-paid Vintage and joint venture partners Metgasco and Bridgeport $15m, which Mr Gibbins said allowed the project to be brought online much sooner than would otherwise have been the case.

“AGL showed its willingness to step up and encourage new players with new supply – something keenly needed by the east coast gas market,’’ Mr Gibbins said.

“The long-term supply agreement with AGL was pivotal to Vintage securing the capital required to commit to the project.’’

The Vali field is contracted to supply 9-16 petajoules of gas to AGL out to the end of 2026, with the field having proved and probable gas reserves of 101PJ.

“Vintage has refrained from contracting the bulk of the field’s gas reserves, as it builds a thorough understanding of the field’s producing reservoirs from its three existing wells,’’ the company told the ASX in a statement.

“The understanding acquired over the first six to nine months of production will inform the preparation of a full field development plan and marketing of Vali’s uncontracted gas, which currently stands at 85PJ.’’

Vintage said it expected the second and third production wells at Vali to come online in early and late March respectively.

“The focus in this initial production appraisal period will be on assessing and learning from the performance of the individual producing reservoirs in each well, rather than short-term output maximisation,’’ Mr Gibbins said.

“By the second half of this calendar year we expect to be in a position to outline the most value-accretive development plan for the field and the scale and profile of an expanded gas supply we can take to market.”

Vintage said the Odin gas field, about 7 km west of Vali, had also been independently certified as containing a resource of approximately 40PJ of gas, with Vintage’s share 19PJ.

The Vali gas is being processed through the Moomba gas hub.