While the pipeline is very early on in the development phase, Mr Spink has said that demand has been extremely high.
“A lot of people are interested putting gas into the pipeline. We have got a 14 inch pipeline at the moment, but the plan is to get it bigger; we have put a hold on the line pipe production starting until after April 2016.
“We are giving producers a few more months to tell us how much gas they actually want to put into the pipeline. At the moment the 14 inch line should be comfortably filled; however if we can put in an 18 inch line, it means we are not going to have to loop in a couple of years’ time, and it means everyone should get a reduction in tariff which benefits everyone.”
In terms of connectivity and how the Northern Gas Pipeline (NGP) will enhance competition in the market, Mr Spink says that by being awarded the operatorship of the NGP, Jemena will bring some welcome competition to the market.
“APA Group has been the biggest gas company in Australia, and I think having someone else win this pipeline is good for the market. It means we are a competitor up here in the Territory now. Producers and shippers have an option as to where they want their gas to go.”
Another driving force behind Jemena’s successful bid has been its new owners in the State Grid Corporation of China, according to Mr Spink.
“Our owners really want to invest in Australia. The market is a little bit quiet at the moment after the oil price slump, and so Jemena needed to expand. We have been wanting to expand for a couple of years but this is the first big chance where we could see a chance to interconnect to the east coast pipeline grid really well.
“The NGP is the initial link, then we plan to connect from Mount Isa through to Wallumbilla. It will then connect with the hub at Wallumbilla, then potentially go up one of the LNG pipelines, or go via the Queensland Gas Pipeline.
“It is all about trying to interconnect that grid and to create a market reliability and a national grid approach but with options for producers and shippers too. There’s a bigger picture at play, which is also why we are trying to get this 18 inch line going; it makes the next step much easier.”
McConnell Dowell to construct