Vintage Energy extends Odin gas supply deal to Pelican Point Power

Vintage Energy (ASX: VEN) has continued its run of success with the signing of a new gas sales agreement for the Odin natural gas field in South Australia’s Cooper Basin.

Having commenced initial production at Odin only last month, Vintage, a 50% interest holder and operator of the PRL 211 permit, has signed an additional two-year gas sales agreement for the gas field.

With its joint venture partners Metgasco (ASX: MEL) (25%) and Bridgeport (25%), Vintage has agreed and signed terms with the ENGIE owned Pelican Point Power for the supply of gas from 1 January 2025 to 31 December 2026.

Adds to previous agreement

Odin is already sending gas to the Pelican Point Power station in South Australia under a May 2023 agreement for the supply of gas from Odin from field start-up to December 2024, the maximum period then available under an ACCC authorisation in place at that time.

Vintage managing director, Neil Gibbins, said the new agreement comes on the back of the receipt of ACCC authorisation in late May which allowed the joint venture to jointly market gas for longer terms than the preceding interim authorisation.

“We are very pleased to have extended our agreement with ENGIE for supply to Pelican Point Power,” Mr Gibbins said.

“Interest in securing gas supply remains strong and we were keen to add to our contract coverage at Odin once we were granted the necessary ACCC authorisation. The price cap exemptions provided to producers selling to the domestic market provides a strong incentive for connection and contracting of new gas supply and, with this latest agreement, we have now met our contracting targets for the medium term. Vintage has a strong contractual position as a dual field producer.”

The JV and ENGIE have agreed to prices that are in line with current expectations for gas supplied to the east coast domestic market in 2025 and 2026.

Mr Gibbins said the agreement provides for interruptible supply of all gas produced from the Odin gas field in the contract period.

Significant exploration upside

Located in licence PRL 211 in the South Australian section of the Cooper Basin, Odin-1 was discovered in 2021.

The PRL 211 JV is already considering the drilling of a second well at Odin with Vintage having already identified significant exploration potential at Odin and its nearby Vali field.

Vintage currently holds more than 40 petajoules of uncontracted 2P gas reserves connected to east coast markets which is available for contracting.

Notably, its Vali and Odin gas supplies are exempt from the $12/GJ price cap set by government regulators.

Two fields in production

The signing of a new gas sales deal is another significant event in what has been a remarkable year for Vintage and its plans to supply natural gas to an energy hungry Australian east coast market.

In February it commenced production from the Vali gas field in permit ATP 2021, located in Queensland adjacent to the Queensland-South Australia border.

The ATP 2021 Joint Venture, which has the same make-up as the Odin JV, is currently supplying AGL Energy under an initial contract to sell an estimated 9 petajoules to 16 petajoules of gas.