Two massive Queensland liquefied natural gas (LNG) projects will share pipeline infrastructure and swap gas in a deal expected to save hundreds of millions of dollars.
The proponents of the multi-billion dollar Gladstone LNG and Australia Pacific LNG projects say the agreements will make gas transportation between the Surat Basin gas fields and processing plants near Gladstone more efficient.
The deal is designed to avoid duplication of a 140 kilometre pipeline, and allow both joint venture parties to transport their gas.
Trevor Brown, the Queensland vice president at Santos, the operator of GLNG, said it would be hard to quantify in dollar terms the savings it will deliver for each project.
"It avoids spending unnecessary capital, duplicating pipelines in the range of hundreds of millions of dollars, but it also importantly entails gas swaps and commercial arrangements that reduce risk and add operational efficiency to both projects," he said.
Without the deal, which encompasses five gas fields, the two projects would have needed an additional pipelines and multiple connection points, Mr Brown said.
He also rejected suggestions the agreements had taken too long to come to fruition, with both projects working towards delivering first LNG in 2015.
"These are complex technical and commercial arrangements," Mr Brown said.
The agreements create a platform for future co-operation among coal seam gas (CSG) participants, he said.
David Baldwin, the chief executive of LNG for Origin, the operator of the Australia Pacific LNG project, said the three major projects in the area could work together on security and emergency management around Curtis Island.
"We are talking with all the parties around those sort of areas of mutual support," he said.
"This will be the first step of many to come."
Santos shares were up 27 cents at $14.79 at 1453 AEST, and Origin shares were up 31.5 cents at $14.725.
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