Australian LNG player Santos has secured new exploration acreage in Queensland’s key gas-producing Surat and Bowen Basins, in a 50-50 joint venture with Shell.
The PLR201718-2-5 license covers approximately 400 square kilometers, located 19 kilometers east of the town of Surat, and was released by the Queensland Government exclusively to boost domestic gas supply on the east coast, Santos said in a statement.
The acreage is immediately south of the Wallumbilla hub which means the Santos-Shell joint venture can take advantage of existing infrastructure, lowering development costs and accelerating the delivery of natural gas to the domestic market.
Exploration in the new acreage will target natural gas in deep sandstone reservoirs of the Bowen Basin, beneath the Surat Basin.
If the results are positive, the Santos Shell joint venture will potentially unlock a material new gas supply source for the Australian east coast domestic gas market.
Santos added it is on track to supply about 70 PJ of natural gas to the east coast domestic market in 2018, which is almost 13 percent of expected demand this year.