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Santos redirects gas from Gladstone LNG

Australian independent says its expects to sign more domestic gas supply deals to help with local energy shortages

Australia's Santos said today it has redirected gas reserved for other purposes including LNG export to instead supply gas to Engie's Pelican Point Power station in South Australia.

The contract is for 15 petajoules (14.1 billion cubic feet) of gas starting in January 2018, and Santos will source the gas from a mix of Gladstone LNG and portfolio gas.

Santos chief executive Kevin Gallagher said energy security for South Australia was a priority and the agreement demonstrated the company’s willingness to work with its Gladsone LNG partners to reach a positive outcome.

The Australian Energy Market Operator in a recent report identified that resuming full service at Pelican Point was critical to South Australia’s electricity needs.

“It also shows we are working with the Turnbull Government to deliver affordable and reliable energy to all Australians, and as a leading domestic gas producer across this country, Santos is best placed to bring energy security to Australian households and businesses,” said Gallagher.

In the coming months, Santos said it will announce additional domestic supply contracts.