Blue Energy continues focus on long-term gas supply agreements, as Bowen pipeline study progresses

Blue Energy ASX BLU long-term gas supply agreements Bowen pipeline study
Blue Energy is looking to secure long-term supply agreements for 3,000PJ of its contingent gas resource.

Aspiring gas producer Blue Energy (ASX: BLU) has continued to focus on locking in long-term supply agreements for its proposed output from its acreage in Queensland’s North Bowen Basin.

The company has bedded-in agreements for 400 petajoules of proposed production with the gas to fed through a new interconnect pipeline from Moranbah to Wallumbilla.

Blue’s wholly-owned permit ATP814 in the North Bowen Basin alone has been certified to contain a 2C (best estimate) contingent gas resource of 1,119PJ, and 3,248PJ of recoverable gas on a 3C (high estimate) basis.

To unlock this resource and economically underpin the pipeline, Blue is hoping to book long-term supply agreements for 3,000PJ of contingent gas resource.

Government support

Queensland and Australian governments’ have co-funded a feasibility study into the Bowen pipeline, with work on the project starting during the June quarter.

A consortium comprising KPMG, GHD and Netherland, Sewell and Associates were contracted to deliver the study and Blue’s input was sought and given.

To support ongoing exploration in the North Bowen and Galilee Basins, the Federal Government allocated $15.6 million grant money for drilling initiatives.

The Federal Government is also seeking submissions for the final version of the National Gas Infrastructure Plan which is scheduled for release later this year.

Blue noted it had actively participated in the process to ensure the government recognises and acts on the benefits of developing the North Bowen Basin, including providing funding incentives.

Hydrogen initiative

To mitigate carbon emissions from its proposed development in the Bowen Basin, Blue executed a memorandum of understanding with Stanmore Resources (ASX: SMR) during the June quarter.

The MoU proposes Blue will convert pilot gas to hydrogen that would otherwise by flared and supply it to Stanmore’s Isaac Plains Complex equipment fleet.

Converting the pilot gas to hydrogen instead of flaring it would reduce greenhouse gas emissions, while also decreasing Stanmore’s diesel fuel consumption.

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