General

Strike Energy Supplies Gas to Austral Brick

Share Print Bookmark    |    Thursday,February 27,2014

Southern Cooper Basin Gas Project

Strike Energy Limited has announced the Company has entered into a Gas Supply Option Agreement for 12.5PJ of gas with Austral Bricks, a subsidiary of Brickworks Limited.

The gas is to be produced by Strike from its Southern Cooper Basin Gas Project to be developed on the substantial gas resource identified within the PEL 96 permit area.

The Option Agreement complements the gas supply option agreement signed by the Company with Orora Limited for 30PJ of gas, as announced to the market on 15 January 2014 with the same key terms:

• The grant of an option to Austral Bricks for the supply of 12.5PJ of gas by Strike, to be delivered at 1.25PJ per annum, at a fixed price over a 10 year term from 2017, the expected commencement date of production from the Project.
• The payment of an option fee to Strike by Austral Bricks as a gas pre‐payment, conditional only upon the PEL 96 joint venture proceeding with a pilot production test project.
• Austral Bricks can then exercise the option when a decision is made by the PEL 96 joint venture to proceed with development of the Project.

Strike will use the option fee to accelerate the PEL 96 work program following the recent confirmation of a substantial, continuous gas resource directly under the Moomba to Adelaide gas pipeline.

The option agreements with Orora and now Austral Bricks for a total of 42.5PJ of gas follow the announcement in July 2013 of a binding term sheet with Orica for the supply of up to 150PJ of gas over a 20 year period.