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BHP Billiton Plc
News Release
17 May 2002
BHP BILLITON APPROVES MINERVA GAS DEVELOPMENT IN VICTORIA
BHP Billiton today announced approval for development of the Minerva gas
field in the offshore Otway Basin, Victoria, Australia.
The majority of the Minerva gas will be sold under contract into South
Australia via a new pipeline infrastructure link which will connect the
Victorian and South Australian principal gas transmission systems. The sale
underpins BHP Billiton`s strategy to sell gas from Victoria into four
eastern states markets as well as opening an additional gas supply source.
The Minerva field development is a greenfield project that will
commercialise an intermediate-sized gas resource and provide a robust
economic return. Capital expenditure for the development will be around
US$137 million (BHP Billiton share US$123 million).
Minerva is a natural gas field with a small amount of liquid condensate. The
field has an expected life of 10 years and contains estimated proven and
probable gas reserves of 301 billion cubic feet (Bcf) of gas (BHP
Billiton share 271 Bcf). It also contains 1.24 million barrels of liquids
(BHP Billiton share 1.1 million barrels).
The Minerva development involves the drilling and installation of two subsea
well completions in 60 metres of water, approximately 10 kilometres offshore
from the township of Port Campbell. Construction will commence during 2002,
with first gas expected in the first quarter of 2004.
The project was subject to a comprehensive environmental impact assessment
process that involved extensive consultation with the local community and
other key stakeholders. Both State and Federal Government Ministerial
assessments and approvals have been granted for the development to proceed.
A single flowline will transport the gas to the coast, through a
subterranean shore crossing to an onshore gas processing facility where
liquids will be removed prior to exporting the gas to South Australia.
The gas plant will have a gross design production capacity of 150 terajoules
of gas per day [TJ/d] (BHP Billiton share 135 TJ/d). Approximately 600
barrels (gross) of stabilised condensate will also be produced per day at
initial gas sales rates.
In March 2002 BHP Billiton signed a take or pay Gas Sales Agreement with
Pelican Point Power Limited (a wholly owned subsidiary of International
Power plc) for the provision of Minerva gas (at an initial average rate of
approximately 115 TJ/d) over a 10 year period into a greenfield 680
kilometre pipeline terminating in Adelaide.
Volumes in the Gas Sales Agreement will underwrite the Minerva development
with up to 90 per cent of BHP Billiton`s share of reserves being
contracted. The remainder of the gas will be sold in the South East
Australian market as demand dictates.
President and CEO BHP Billiton Petroleum Philip Aiken said the development
of the Minerva gas field is part of the Group`s focus on gas
commercialisation and represents a major element in BHP Billiton`s Eastern
Gas Strategy.
"The development of the Minerva field will assist us in building on the
large gas market share that the Group has developed in Victoria over the
past 30 years by enabling us to expand into other south eastern Australian
states," he said.
BHP Billiton has made significant progress developing gas markets in New
South Wales and Tasmania in recent years. Since September 2000, Bass Strait
gas has flowed into New South Wales via the Eastern Gas Pipeline, which now
supplies 20 per cent of that State`s gas requirements.
In addition, BHP Billiton Petroleum signed an agreement in April 2001 to
supply natural gas from the Longford processing plant to Tasmania,
supporting the construction of an undersea pipeline.
BHP Billiton holds a 90 per cent interest in the Minerva field and will be
the project operator. The remaining 10 per cent interest is held by Santos
(BOL) Pty Ltd.
****
Further information can be found on our Internet site:
http://www.bhpbilliton.com
Australia United Kingdom
Dr. Robert Porter, Investor Mark Lidiard, Investor & Media
Relations Relations
Tel: + 61 3 9609 3540 Tel: +44 20 7747 3956
Mobile: +61 419 587 456
email: Robert.Porter@bhpbilliton.com email:
Mark.T.Lidiard@bhpbilliton.com
Mandy Frostick, Media Relations Ariane Gentil, Manager
Tel: +61 3 9609 4157 Communications
Mobile: +61 419 546 245 Tel: +44 20 7747 3977
email: Mobile: + 44 7881 518 715
Mandy.J.Frostick@bhpbilliton.com email:
Ariane.Gentil@bhpbilliton.com
United States South Africa
Francis McAllister, Investor Michael Campbell, Investor & Media
Relations Relations
Tel: +1 713 961 8625 Tel: +27 11 376 3360
Mobile: +1 713 480 3699 Mobile: +27 82 458 2587
email: email:
Francis.R.McAllister@bhpbilliton.com Michael.J.Campbell@bhpbilliton.com
Date: 17/05/2002 09:43:32 AM Produced by the SENS Department
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