NATURAL GAS FOR TASMANIA

Abstract

Tasmania is the only state in Australia which is not supplied with natural gas, and yet a significant gas, condensate and oil resource lies off the Tasmanian coast awaiting development.

The Yolla field, discovered by Amoco, SAGASCO Resources, the Bass- Cue Group, Romsey Resources and Southeastern Petroleum in 1985, has sufficient resource potential to support the development of a natural gas supply infrastructure in Tasmania. The field is rich in LPG and condensate and also contains a small oil pool. Tests on the Yolla 1 well were the first in the Bass Basin to flow hydrocarbons and they demonstrated that the field has excellent reservoir properties for commercial development.

The keys to the initiation of a gas, condensate and oil development in Tasmania are the need for a significant market for the natural gas and an oil price somewhat better than US$20 per barrel. While there are many major manufacturing and mineral processing plants on the Tasmanian North Coast which would benefit from the stimulus provided by a reliable natural gas pipeline supply, these industries alone provide insufficient load to make an offshore gas development economic. The Bell Bay power station, a thermal power station of 240 MW capacity fired on fuel oil, could, if converted to gas and operated to provide base load supply, generate sufficient base gas demand to enable a project development to proceed.

A gas condensate development would provide a substantial stimulus to the Tasmanian economy through:

direct investment in the project itself;fostering further development of processing industries on the North Coast;providing cheaper electricity than available from new hydroelectric and coal fired stations;contributing significantly to Tasmanian self- sufficiency in liquid fuels; andreleasing scarce government capital for debt reduction or other uses.