Gas will be used for a small-scale, highly efficient, combined heat and power (CHP) plant for glasshouse climate control purposes, with any excess electricity sold to the local grid. Virtually all CO2 produced from the combined heat and power plant will be distributed to the plants to significantly improve crop yields and plant robustness.
Dart Energy expects to commence work on a CSG production pilot well at Fullerton Cove early in 2012, once formal approvals have been received. This pilot program will test the commercial viability of the gas resources.
Subject to commercial gas flows being achieved as part of the production pilot, Dart Energy will supply natural gas to the project, from a small number of wells in its Fullerton Cove licence area near Newcastle.
Dart Energy Australia Chief Executive Officer Robbert de Weijer said “This agreement shows that CSG development can co-exist with alternative productive land uses including agriculture in an environmentally sustainable manner.”
Dart Energy also announced an equity investment in the glasshouse project.
“We plan to not only supply gas to Maria’s Farm Veggies but to invest directly in this high-tech future for vegetable production in NSW,” Mr de Weijer said.
The glasshouse project is expected to be completed by early 2013, subject to approvals, and will generate 125 jobs in the Newcastle area or up to 200 if the project is expanded.
The gas sales agreement terms include:
- An initial ten-year term, commencing upon Dart Energy achieving commercial gas flows.
- Supply of up to 6.3 petajoules (PJ) of gas over ten years, based on gas supply to an 8 megawatt (MW) CHP plant delivering electricity and hot water to the project and excess electricity to the grid. Volume could increase to 2.4 PJ/a in the event of a project expansion to 32 MW.
