Santos has announced that it has inked a heads of agreement with Perdaman Group for the further study and design of Perdaman’s new ammonia production facility using Narrabri natural gas.
The announcement follows the singing of a non-binding agreement between the two companies in February this year under which Santos had agreed to supply Perdaman with 14.5PJ of natural gas per annum over 20 years, subject to a final investment decision for its Narrabri Gas Project which is currently being assessed by the NSW Department of Planning, ahead of a decision by the Independent Planning Commission.
Santos said the Pre-FEED (front-end engineering and design) study is the next step in the development of a chemical and fertiliser facility near Narrabri, which will use appraisal and early development gas.
“It will also further define hybrid power facility options, a combination of gas-fired power generation integrated with renewable power generation to provide electricity to both the Narrabri Gas Project and the ammonium nitrate plant.” ,” Santos said in a statement.
Santos Managing Director and CEO Kevin Gallagher said the new plant and the Narrabri Gas Project will provide a big boost for small businesses and the communities in and around Narrabri, creating in the excess of a thousand jobs in the region.
“The project will generate substantial economic revenue and employment opportunities for New South Wales, Narrabri and the surrounding region,” Mr Gallagher said.
“The Narrabri Gas Project could produce enough gas to supply up to half NSW’s needs, with more and more manufacturers supporting it because they recognise the advantages of having a reliable and competitively-priced source of gas in NSW.”
Perdaman Group’s founding Chairman and Managing Director, Vikas Rambal, said Narrabri is ideally located for new manufacturing with nearby access to the new Inland Rail linking key east coast ports and the national highway system.
“I hope the Narrabri Gas Project will proceed to a final investment decision as soon as possible to give certainty to this project and attract more to the region,” Mr Rambal said.
“If our plant goes ahead it will not only bring new jobs but competition, which is always good for prices, to the market in NSW and that will be good for farmers in the region.”