New gas from the Mereenie fields is still powering the Territory

New gas from the Mereenie fields is helping keep our lights on and airconditioners running. Read about the latest finds.

The Territory’s largest gas field, Mereenie, has a new lease on life, with better than expected flows from its two latest wells drilled sending new gas to NT customers, including the Channel Island Power Station.

Discovered in 1963 and with first production in 1984, the Mereenie oil and gas field, located in Central Australia’s Amadeus Basin, about 250km west of Alice Springs, is now a four-way joint venture led by operatorCentral Petroleum with 25 per cent, Echelon Mereenie Pty Ltd with 42.5 per cent, Horizon Australia Energy Pty Ltd with 25 per cent and Cue Energy with 7.5 per cent.

The Amadeus Basin, which includes Mereenie, along with the Palm Valley and Dingo gas fields, is the Territory’s largest gas precinct.

In a statement last week Echelon said that West Mereenie 30, the second and final well in the recent Mereenie drilling program, is producing about four terajoules a day, exceeding the pre-drill expectation of 3TJs a day.

Central Petroleum’s Mereenie well in the Amadeus Basin. Picture: Central Petroleum

Echelon chief executive Andrew Jefferies said the combined result from drilling at West Mereenie 29 and West Mereenie 30 has increased Mereenie gas sales by 9TJs a day compared to a pre-drill expectation of 6TJs a day.

The field’s daily sales capacity is currently about 32TJs a day, with the gas from the new wells being delivered about a month ahead of schedule.

He said the additional Mereenie gas is being sold on an ‘as available’ basis into the Northern Territory market via recently executed Gas Sales Agreements with the NT Government which kicked in from January 1.

Central Petroleum chief executive and managing director Leon Devaney explained that drilling had moved from the rim of the Mereenie field into the field’s interior.

“What we’re doing now, which is relatively new, is moving into the crest of the field,” he said.

“Historically, most of the wells have been drilled around the edge of the field and what we’re doing now is drilling on that crestal area.

“Imagine that it’s shaped like an upside down bowl and that’s holding the gas. If you drill at the crest you can recover as much gas as possible. That’s where it will rise to and that’s the bit we’re going after now.

Leon Devaney Central Petroleum chief executive and chairman

“The field’s got quite a long life. The wells that are already there will decline slowly and naturally and will produce for quite some time.

“What we’re trying to do with these wells is to retain a plateau at around 30TJs a day, which we’ve achieved from this last drilling, and we’re looking at further drilling in the future to keep that plateau going.

“This is a great outcome for the project, with production rates about 50 per cent above pre-drill expectations, commencement ahead of schedule, and project delivery under budget.

“A sincere thanks to all our staff, contractors, and Joint Venture partners involved in this project. Working over summer in the Territory heat is never easy, but the team worked together to safely deliver reliable affordable energy to Territorians.

“We now look forward to other opportunities to increase production within a tight NT gas market to drive further value from our operating assets.”

It’s estimated about half of the Top End’s gas demand, mainly used for power generation, is sourced from Mereenie and nearby gas fields via a 1600km pipeline. As well as Mereenie, Central Petroleum also owns and operates the Palm Valley and Dingo gas fields in Central Australia in a 50 per cent joint venture partnership with Echelon Resources.

Energy Minister Gerard Maley welcomed the positive results and the gas sale agreement with Central Petroleum inked last year by the previous NT Government.

“This is fantastic news for the Northern Territory, as this additional gas is being sold into the NT market under current gas sales agreements,” Mr Maley said.

“The NT Government has a gas sales agreement with the Mereenie JV to provide gas to the Territory until 2030.

This gas is vital to the rebuilding of the NT economy, fuelling future economic growth and prosperity for Territorians.”

Originally published as New gas from the Mereenie fields is still powering the Territory