Strike maintains FID target for Cooper basin gas

OREANDA-NEWS. Australian independent Strike Energy is keeping to its target of a final investment decision (FID) on its southern Cooper basin gas project by the end of this year. Production would start in 2017 with an average annual output of 53.02 petajoules/yr(1.46bn m?/yr).

The southern Cooper basin gas project is located in PEL 96 permit in South Australia, with spending to be funded from three gas agreements Strike has clinched. The permit is located near the Moomba-Adelaide gas pipeline.

Testing in the southern Cooper basin gas project is progressing more slowly than anticipated, said a research note by the investment bank unit of the Royal Bank of Canada. This is as the slide in oil prices has prompted gas developers in the Cooper basin to cut capital expenditure, as the relatively high cost of extracting unconventional gas from area has seen a slowdown in activity.

Strike has agreements to sell 10PJ/yr for 10 years to Australian chemicals producer Orica. The deal is an extension of an original deal to sell 7.5PJ/yr to Orica over 20 years. It also has 10-year fixed price deals with packaging company Orora for 3PJ/yr and building company Brickworks to supply 1.25PJ/yr.

Strike, which is the operator and 66.67pc owner of PEL 96, with fellow Australian independent EWC owning the rest. They plan to extract coal-bed methane gas in the Cooper basin at depths of more than 300m.