Arrow Energy, a 50:50 joint venture between Shell and PetroChina, has unveiled ambitious plans to significantly expand its long-running Surat Gas Project (SGP).
The expansion will focus on an area located northeast of Miles in Queensland’s Western Downs, known as SGP North.
This new development is poised to bring over 130 terajoules of additional gas to the market daily, serving both long-term contract and domestic customers.
Significant Expansion of Surat Gas Project
The SGP North initiative is a crucial part of the broader Surat Gas Project, which is designed to produce more than 4,000 petajoules of gas throughout its lifespan.
The expansion plan includes several key components that will enhance the project’s overall capacity and efficiency.
Key elements of the SGP North expansion include:
- Installation of up to 450 new production wells and associated gathering systems.
- Upgrades to local roads and telecommunications infrastructure.
- Construction of a four-compressor field compression station with a capacity of 121 TJ/d.
- Development of a 27-kilometer medium-pressure pipeline, connecting the new compression station to QGC’s Bellevue central processing plant.
- Establishment of a low-pressure gas connection to QGC’s McNulty field compression station.
- Expansion and enhancement of water and brine management infrastructure.
Strategic Importance and Project Timeline
Arrow Energy’s CEO, Zhengxin Peng, expressed satisfaction with the approval received from shareholders for the SGP North development.
The first gas production from this expansion is targeted for 2026. Peng emphasized that this development comes at a critical time when the demand for natural gas is rising to support homes, businesses, and industries.
Peng stated, “The SGP North development will strengthen Arrow’s position as a leading natural gas producer on the east coast.”
He highlighted the vital role of natural gas in the ongoing energy transition and noted that the expansion reflects the confidence shareholders have in Arrow Energy’s capability to manage and deliver large-scale projects.
Economic Impact and Community Benefits
The expansion of the Surat Gas Project is expected to bring considerable economic benefits to the Miles region.
The project is projected to create up to 400 jobs, providing significant opportunities for local contractors, suppliers, including Indigenous businesses, and the broader community.
In addition to job creation, the project will bring other economic advantages, such as improvements to local infrastructure, particularly roads.
Peng assured that, similar to the first phase of the SGP, efforts will be made to minimize the environmental footprint and impact on the community.
This will be achieved through an agreement with Shell QGC, which allows Arrow Energy to utilize existing facilities and infrastructure, thereby reducing the need for new construction.
Long-Term Vision for the Surat Gas Project
The Surat Gas Project is underpinned by a 27-year gas sales agreement with Shell QGC and is expected to involve the development of up to 2,500 gas wells.
Over the duration of the project, Arrow Energy anticipates producing around 4,000 petajoules of gas.
The project is also expected to create approximately 1,000 jobs and involve a significant investment in local road upgrades, with tens of millions of dollars allocated annually for these improvements.
By reinforcing its commitment to sustainable development and community engagement, Arrow Energy aims to play a pivotal role in meeting the growing demand for natural gas while supporting the local economy and minimizing environmental impact.