The agreement is for the transportation of up to 1,200 PJ of gas over 22 years from January 2012, from Origin’s Queensland gas projects. It also includes additional long term capacity on Epic’s Moomba to Adelaide Pipeline System and options to further expand the capacity of the SWQP in the future.

Epic has been undertaking feasibility studies into the Stage 3 expansion of the SWQP and QSN Link project. Dubbed QSN3, the project will involve the construction of a new 935 km, 450 mm diameter pipeline adjacent to Epic’s existing SWQP. The expanded SWQP daily capacity would be increased from 168 TJ to approximately 380 TJ.

Nacap Australia has been awarded the construction contract for the expansion. The contract is dependent on Epic obtaining financial close. Nacap expects to finalise plans and begin facilities construction from March 2010 and pipeline installation from mid-2010.

As well as appointing an Australian construction contractor, Epic has said a significant amount of the looping will be made from Australian steel.

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The SWQP connects Queensland’s coal seam gas fields with the QSN Link pipeline, which connects into the Moomba to Sydney Pipeline System and the Moomba to Adelaide Pipeline. Origin has said that in certain circumstances where the project does not proceed, despite Origin being prepared to provide funding, Epic may be required to provide Origin with some zero charge gas transportation services on the Moomba to Adelaide Pipeline System.