Metgasco on track to start Vali gas flow in October

Metgasco and its partners have reached a major milestone in their development of the Vali gas field in Queensland with all wells now ready for production.

With completion of the second of four operational phases, the joint venture has now begun fabrication of the Vali production skids, marking the start of the construction phase which will connect the field to the Moomba gas gathering system about 13km away at the Beckler Field in South Australia.

Installation of the pipeline, and construction of the metering and tie-in facilities is currently being scheduled in an optimised fashion to maximise efficiency of crew rosters and camp utilisation.

Metgasco (ASX:MEL), operator Vintage Energy and Bridgeport Energy – who hold 25%, 50% and 25% of the field respectively, seek to start gas production from Vali in October this year.

The field is expected to supply between 9 petajoules and 16PJ of natural gas to AGL in the period from field start-up to end-2026 under the Gas Sales Agreement, which represents about 9% to 16% of the field’s proved and probable reserves of 101PJ.

The JV has also agreed to commence engineering for connection of the Odin gas field across the state border in South Australia to the Vali-Beckler pipeline, as well as preparation of a commercial plan for marketing of the field’s gas

“The JV now has four gas wells in the Vali & Odin production hub completed for production and I look forward to the safe and successful completion of the pipeline installation, facilities construction and commissioning leading to first gas in October,” managing director Ken Aitken said.

Odin Gas field anticipated on stream Mid CY23- Well-timed gas production

The JV’s move to initiate conceptual engineering to develop the Odin field via the Vali infrastructure and start marketing the uncontracted 36 bcf of gross resources from Odin, is well-timed given the Australian Competition and Consumer Commission’s forecast that Australia’s East Coast will experience a gas shortfall equal to about 10% of annual domestic demand in 2023.

For Metgasco and its partners, is a massive opportunity to benefit from securing elevated gas prices for Odin given the extent of the East Coast gas market shortfall next year.

This article was developed in collaboration with Metgasco, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.