- Metgasco (MEL) has signed an agreement for the sale of all gas produced from the Vali Field
- The agreement is between the ATP 2021 Joint Venture parties and AGL Wholesale Gas
- Under the agreement, gas will be supplied to AGL from mid 2022 to 2026, estimated to be up to 16 petajoules
- Terms that will be set out in the agreement will form the basis of a fully termed gas sales agreement, which will include AGL providing an upfront payment of $15 million to the JV
- On the market, Metagasco is up 10.3 per cent and is trading at 3.2 cents per share
Metgasco (MEL) has signed an agreement for the sale of all gas produced from the Vali Field.
The agreement is between the ATP 2021 Joint Venture parties and AGL Wholesale Gas.
The sale is from field start-up, expected mid-2022, through to the end of 2026. This is anticipated to be a minimum of nine petajoules (PJ) and up to 16 PJ of gross sales gas over the contract term.
Terms that will be set out in the agreement will form the basis of a fully termed gas sales agreement which will include AGL providing an upfront payment of $15 million to the JV in three tranches.
Funds will be used for the Vali Field to fund the work program, including completing all three Vali wells and the tie-in of the Vali Field to the nearby Moomba pipeline.
Metgasco Managing Director Ken Aitken is pleased with the agreement for AGL.
“This deal is a significant step forward in delivering Metgasco’s objective of becoming a gas producer in mid CY22,” Mr Aitken said.
“The Heads of Agreement for the proposed sales of up to 16 PJ of gas to AGL will deliver significant cash flow to the joint venture over the term of the contract and also provide the joint venture with an upfront payment for funding capital works required to achieve first gas.
“These are great outcomes for Metgasco and all the participants in the agreement.
“We are excited to have AGL as a foundation gas buyer of Vali Field gas and look forward to providing AGL with a consistent supply of gas from the Vali Field over the next four to five years,” he concluded.
On the market, Metagasco was up 10.3 per cent and is trading at 3.2 cents per share at 12:38 pm AEDT.