Cooper Energy Announces New Gas Sale Arrangements with AGL

Source: 9/13/2021, Location: Not categorized

- New Otway Basin Gas Sales Agreement signed for all developed and uncontracted volumes
- Existing Sole Gas Sales Agreement amended
- New arrangements reduce third-party gas purchases and optimise value

Cooper Energy Limited (COE) and AGL Energy Limited (ASX: AGL) have agreed to enter into a new Gas Sales Agreement (GSA) for all developed and uncontracted volumes from the Casino, Henry and Netherby fields in the Otway Basin, and amendments to the existing Sole GSA. These new arrangements will take effect from 1 January 2022.

The new Otway Basin GSA is for supply of all developed and uncontracted volumes from the existing Casino, Henry and Netherby wells. The term is the earlier of cessation of production from the existing wells or first production from the Otway Phase 3 Development (OP3D). Pricing for the new GSA is consistent with the ACCC’s July 2021 Gas Inquiry Interim Report range of $6-8/GJ for contracted gas supply.

The Sole GSA has been amended so the Annual Contract Quantity (ACQ) is reduced from 12 PJ/year to 6 PJ/year and the term extended by two years to 31 December 2030. The amendments include a mechanism to increase the ACQ by up to 6 PJ/year from future Sole production increases, with the total incremental volume for AGL capped at 30 PJ. GSA pricing and other terms remain unchanged. Sole production above the previous total contracted volume of 22PJ in CY2022, or incremental volume not purchased by AGL, will be available to sell into new contracts.

There is a reduced requirement for third-party gas purchases in FY22 due to the new gas sale arrangements with AGL. Accordingly, the FY22 full-year sales volume guidance range has been narrowed. All other guidance is unchanged.

Cooper Energy Managing Director, David Maxwell, said that the new gas sale arrangements with AGL are further demonstration of the flexibility within Cooper Energy’s gas portfolio and the steps being taken to optimise value and position the company for future growth.

“We are pleased to be working closely with AGL and look forward to ongoing collaboration.

“The new gas sale arrangements are a further illustration of Cooper Energy taking decisive action to increase certainty and position the company for further growth”, Mr Maxwell said.

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