Santos declines Queensland Hunter Gas Pipeline

NARRABRI: Part of the Santos gas operations in Narrabri. Santos have again declined to partner with the Queensland Hunter Gas Pipeline in favour of another pipeline. Picture: Dean Sewell
NARRABRI: Part of the Santos gas operations in Narrabri. Santos have again declined to partner with the Queensland Hunter Gas Pipeline in favour of another pipeline. Picture: Dean Sewell

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Natural gas producer Santos has poured cold water on renewed plans for a pipeline through the Hunter Valley. But the company behind the proposed Queensland Hunter Gas Pipeline are standing firm – saying their project is in NSW and Australia’s best interest.

Earlier this month Fairfax Media reported the QHGP were in talks with gas supplier Jemena to operate the first leg of the pipeline between Newcastle and Narrabri. Construction was reportedly set to begin once Santos’ Narrabri gas project expansion gains approval.

QHGP hoped to sway Santos away from an existing agreement with the APA group and their Western Slopes Pipeline (signed in January), which will take the gas straight to Sydney – bypassing the Hunter entirely.

On Monday morning, in a statement to Fairfax Media, Santos reaffirmed its plans to stick with the Western Slopes Pipeline.

“As announced, Santos has entered into a Project Development Agreement with the APA Group to construct a proposed pipeline running south west from Narrabri to join into the Moomba to Sydney pipeline,” Santos vice president for Asia, NSW and WA oil assets Bruce Clement said. 

“This pipeline - the Western Slopes Pipeline - will be the most efficient and timely way to bring much needed natural gas to the NSW domestic market.

“Santos is not working with Queensland Hunter Pipeline and has no plans to send any of the gas from the Narrabri Gas Project via their proposed pipeline route through the Hunter Valley.”

Santos also responded to suggestions from the QHGP that the existing relationship could result in the gas being transported north (to Queensland) for export to the international relationship.

“Santos has always been clear that the natural gas from the Narrabri Gas Project will be made available to the NSW domestic market,” Mr Clement said.

But QHGP managing director Garbis Simonian said his pipeline was still the better deal for Santos, the communities along its route, and the state at large.

“Our pipeline delivers to gas power stations planned along the route,” he said.

“It will support energy security and the transition to renewables.

“Our pipeline is best for the communities, the state, households and businesses. 

“It’s cheaper, better and more certain that [the gas] won’t divert to Queensland for LNG export.”