In addition, Comet Ridge has had discussions with several parties to examine the feasibility of developing gas-fired electricity generation to supply the significant Galilee Basin coal mine province being proposed along the eastern boundary of Comet Ridge’s ATP 744P.
Mr McCaul says “The market for gas in eastern Australia has tightened significantly in the past year or so, and we believe it will continue to tighten. This means that the resource base that Comet Ridge has already established in the Galilee Basin may be extremely attractive to a number of parties, particularly if the company can progress the gas available from resources category to reserves category in the short to medium term.
“Given our position in the eastern Galilee Basin, we think a sizeable gas resource of this nature would lend itself to a short distance tie-in that could supply gas or power to a number of the planned Galilee Basin large-scale coal mines. Gas could also be moved further to the east to connect into the system that will supply gas to Gladstone for a number of large-scale LNG schemes.
“We believe that there will also be domestic gas sales options that become available for Galilee Basin gas. We have had informal conversations with a number of parties who are logical gas or power users, and will continue these discussions and evaluate which of these options – or combination of these options – will provide the most value.”
Co-operation between coal and gas
Mr McCaul believes there is great scope for coal and gas companies to work together in the Galilee Basin across infrastructure, gas and water. He also believes this co-operation could lead to gas flowing from the basin within two years, despite the fact that it has never yielded a commercial flow of oil or gas.
“The Galilee Basin has seen oil and gas exploration wells drilled for the past 50 or 60 years, and some of these wells have seen shows of oil and small gas flows. However, the basin is still only relatively lightly explored,” he says.