Santos signs MOU with ENGIE for domestic gas supply from the Narrabri Gas Project

Santos announced it has signed a non-binding memorandum of understanding (MOU) with ENGIE for the supply of natural gas from the Narrabri Gas Project for the Australian east coast domestic gas market.

ENGIE is a diversified energy company focused on supporting its customers’ decarbonisation efforts and accelerating the transition to net zero by delivering renewable energy, flexible generation and energy solutions. It operates wind farms, large-scale batteries and gas-fired power stations, and provides energy services to commercial and industrial customers across Australia.

Under the proposed transaction, Santos would supply ENGIE with up to 20 PJ per year of natural gas from Narrabri for a period of at least 10 years from the commencement of operations, with 100 per cent of the supplied gas committed by ENGIE to the domestic market. Santos and ENGIE have also committed to exploring decarbonisation activities through Santos’ third-party carbon management business, specifically via the proposed Moomba phase 2 carbon capture and storage project. The supply of Narrabri gas is subject to Santos making a final investment decision on the Narrabri Gas Project, negotiation and execution of a binding gas supply agreement, and approvals by each party.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said east coast energy users are calling for more gas supply sources, to provide price certainty and improve supply reliability.

“Santos voluntarily committed 100 per cent of Narrabri gas to the domestic market back in 2020. Santos already produces Narrabri gas from appraisal wells for the Wilga Park power station that generates electricity for the northwest NSW grid. This experience, combined with our project development and production experience in Queensland’s Surat Basin, gives us confidence that Narrabri gas will be a very competitive source of domestic gas supply for the east coast market that is further advantaged by proximity to customers in NSW,” said Mr Gallagher.