Central Petroleum and its Palm Valley three way partnership (JV) companions Cue Power Assets and Echelon Assets have signed a binding multi-year fuel gross sales settlement (GSA) with the Northern Territory (NT) Authorities in Australia.
The contract is ready to provide as much as 21 petajoules (PJ) of fuel from the onshore Palm Valley fuel discipline within the NT’s Amadeus Basin.
The deal covers deliveries from the second half of 2026 (H2 2026) by means of to the tip of 2034. It carries a set market worth, shopper worth index escalation and take-or-pay phrases.
Central Petroleum is the operator of the Palm Valley JV with a 50% stake, whereas Echelon Assets holds 35% and Cue Power Assets the remaining 15%.
The companions have made a last funding choice to drill two new wells on the fuel discipline.
Drilling is scheduled to start out in mid-2026, with manufacturing ramping up regularly through the later months of that yr.
Civil works are primarily full, lengthy lead gadgets have been ordered, regulatory approvals are in place or progressing, and the Ensign 974 drilling rig has been contracted.
Central Petroleum expects its drilling and completion price share to be round A$26m ($18.3m), which incorporates an allowance for potential diesel worth will increase.
The 2 new wells are anticipated to initially improve Central Petroleum’s fuel manufacturing capability by roughly 40% if focused manufacturing charges are achieved. The deliberate wells will goal the identical geological formation because the PV-12 effectively, which was drilled in 2022.
As soon as operational, these wells are anticipated to assist restore the Palm Valley manufacturing facility’s capability to fifteen terajoules (TJ) per day.
Gasoline produced in Palm Valley is introduced at low stress from the wells through flow-lines to a manufacturing facility, the place it’s compressed and dehydrated. From there, it enters transmission pipelines certain for patrons within the NT and on the east coast.
The settlement replaces the preparations outlined in a beforehand introduced letter of intent with the Energy and Water Company. That letter additionally included fuel from the Mereenie Gasoline Subject, which the present settlement doesn’t cowl.
Central Petroleum will market Mereenie fuel to different consumers searching for long-term provide.
Central Petroleum CEO and managing director Leon Devaney stated: “It has taken time to get the settings proper, however we now have a major GSA for the Palm Valley JV. Importantly, it underwrites an funding in two Palm Valley appraisal wells on an accelerated foundation.
“The brand new wells will replicate the prolonged lateral designs that had been profitable within the final Palm Valley drilling programme.