DOMESTIC SUPPLY: Senex has been awarded a petroleum lease for domestic-only production.
DOMESTIC SUPPLY: Senex has been awarded a petroleum lease for domestic-only production. Contributed

Senex gas lease approved

DOMESTIC-only gas production is set to begin just 20km from Wandoan by the end of next year.

Gas company Senex gained a petroleum lease in the Surat Basin at the end of March, allowing it to produce gas at its Project Atlas site for the Australian market only.

It comes after Senex won a pilot tender last year, with the State Government requiring gas to be sold and used only in Australia.

Energy Minister Anthony Lynham said since being awarded the tender, Senex had been working to obtain the regulatory approvals to start production.

"Construction work can now begin on the wells and pipelines needed to pump up to 26 petajoules per year of additional gas into the domestic market,” Dr Lynham said.

"This means domestic gas and regional investment and up to 150 regional jobs.”

Senex managing director and chief executive officer Ian Davies said obtaining the lease meant the company was on track to deliver first gas to the domestic market in late 2019.

"It's an exciting step forward,” Mr Davies said.

"The direct award of this petroleum lease is an innovative solution by the Queensland Government to help address the shortage of east coast gas and the quick turnaround of our application shows its continued commitment.”

Western Downs Regional Council mayor Paul McVeigh said the council was supportive of investment that "brings jobs to our region”.

"The recent announcement of Senex's petroleum lease in the Surat Basin will further add to the diversity of our economy and create jobs in our region,” Cr McVeigh said.

"The Western Downs has one of the lowest unemployment rates in regional Queensland, and the energy sector is a key contributor to work opportunities here in our backyard.”

"The energy sector on the Western Downs is made up of coal, gas, ethanol, wind and solar, and it's our diversity that is our strength.”

The announcement comes after two other Australian producers, Central Petroleum and Armour Energy, won tenders to begin exploring for gas for the Australian market at the start of March.

The two producers are set to explore a total of almost 400ha outside Miles and Surat.