Senex Energy has confirmed it expects to start drilling at its Roma North gas development in Queensland, as part of the company’s $1 billion Atlas and Roma North expansion project to boost domestic gas supply.
The gas producer expects to drill more than 280 wells by the end of 2025, delivering 60 PJ of natural gas per year amid the looming energy crisis in the east coast market.
CEO Ian Davies announced in June that Senex had been granted all major approvals to proceed with its expansion development.
“Gas is the essential and reliable energy source that can step in to firm the electricity grid when coal, wind and solar generation is not providing the energy required,” Davies noted.
“Current energy system pressures and forecast gas shortfalls in coming years highlight the urgent need for more reliable natural gas supply in our energy system.”
The plan for the $1 billion project was announced in 2022. However, the government’s intervention in gas markets in December 2022 caused Senex shareholders to pause the investment until sufficient regulatory and investment certainty could be seen.
Offtake gas agreement with the federal government
Last November, the Australian government announced it had negotiated a gas agreement with Senex.
According to the agreement, Senex granted a conditional exemption under the Mandatory Gas Code of Conduct, which the federal government introduced in July 2023. The controversial code set a price cap of $12 per GJ for wholesale gas supply.
Notably, it will require parliamentary support from the Liberal-National coalition or the Greens.
By September 2023, eight long-term natural gas supply agreements had been signed with Australian manufacturers and energy retailers, including CSR and AGL, to support the Atlas expansion.
