Sydney, 13 May (Argus) — Western Australia's state government has introduced legislation to ratify a joint production venture in the onshore Canning basin to allocate 15pc of any natural gas production for the domestic market.
Western Australia said the bill would ratify an agreement signed in November last year by the state government with Japanese trading house Mitsubishi and Australian independent Buru Energy. The remainder of any gas production from the Canning basin joint venture is earmarked for LNG exports.
“This legislation will bring about the continued exploration for natural gas in the remote Canning basin, the development of a gas pipeline to the Pilbara and ensure Western Australian consumers have first use of any gas discovered,” said Western Australia premier Colin Barnett.
Unconventional gas resources in the Canning basin have been estimated by the US EIA at 229 trillion ft³ (6.4 trillion m³), although these have yet to be verified as commercial reserves.
Once the domestic gas project is under development, the agreement provides for potential future gas supply for gas export, Barnett said. Natural gas provides about 50pc of the state's domestic electricity generation.
The 25-year Canning basin joint venture agreement covers 17,000km² covered by five exploration permits. This is the second time the bill has been introduced to parliament, which was initially introduced last November but lapsed.
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