Santos earmarks A$500m for NSW drilling programme

Tweet

Gas major Santos would spend around A$500-million over the next three years in drilling for coal seam gas in New South Wales, following the proposed acquisition of Eastern Star Gas.

Speaking to the American Chamber of Commerce in Australia on Thursday, Santos CEO and MD David Knox said that the company had so far drilled around 25 wells over the last three years in seeking to prove the extent of the gas available for future development in New South Wales.

“Over the next three years, upon completing our proposed acquisition of Eastern Star Gas, we will drill an additional 50 wells, and invest about A$500-million in doing so.”

Knox said that looking beyond that, Santos’ investment could be “much more significant”, adding that even if the development of the coal seam gas business in New South Wales was a third of the size of its Queensland project, around A$2-billion would be added to the New South Wales state revenues, and over 1 000 direct jobs would be created.

“Of course, the knock-on effects of this investment would create thousands of additional jobs within the community and other industries,” he added.

Santos launched a A$924-million takeover offer for fellow-listed Eastern Star Gas last month, in a move to gain 80% ownership of its coal seam gas permits in the Gunnedah basin, in New South Wales.

The acquisition of Eastern Star Gas would be conducted through a recommended scheme of arrangement, under which Eastern Star Gas shareholders would receive 0.068 Santos shares for every Eastern Star Gas share.

Knox said at the time that the acquisition of Eastern Star Gas was a “unique opportunity” to consolidate the company’s Gunnedah basin interests and establish a leading position in Australia’s next major natural gas province.


5 August 2011
miningweekly.com

Gas major Santos would spend around A$500-million over the next three years in drilling for coal seam gas in New South Wales, following the proposed acquisition of Eastern Star Gas.

Speaking to the American Chamber of Commerce in Australia on Thursday, Santos CEO and MD David Knox said that the company had so far drilled around 25 wells over the last three years in seeking to prove the extent of the gas available for future development in New South Wales.

“Over the next three years, upon completing our proposed acquisition of Eastern Star Gas, we will drill an additional 50 wells, and invest about A$500-million in doing so.”

Knox said that looking beyond that, Santos’ investment could be “much more significant”, adding that even if the development of the coal seam gas business in New South Wales was a third of the size of its Queensland project, around A$2-billion would be added to the New South Wales state revenues, and over 1 000 direct jobs would be created.

“Of course, the knock-on effects of this investment would create thousands of additional jobs within the community and other industries,” he added.

Santos launched a A$924-million takeover offer for fellow-listed Eastern Star Gas last month, in a move to gain 80% ownership of its coal seam gas permits in the Gunnedah basin, in New South Wales.

The acquisition of Eastern Star Gas would be conducted through a recommended scheme of arrangement, under which Eastern Star Gas shareholders would receive 0.068 Santos shares for every Eastern Star Gas share.

Knox said at the time that the acquisition of Eastern Star Gas was a “unique opportunity” to consolidate the company’s Gunnedah basin interests and establish a leading position in Australia’s next major natural gas province.


5 August 2011
miningweekly.com