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MDL Advises Of Possible Maui Gas Supply Shortfall

The Chairman of Maui Development Limited (MDL), Dr Lloyd Taylor, confirmed that on 9 November MDL had briefed the parties to the Maui gas contracts on the longer term possibility of a shortfall in gas supply from the Maui gas field.

Dr Taylor said that the Government had been briefed, as the contract to supply gas was solely with the Crown, who then on-sold to other customers.

“As a result of studies nearing completion, MDL estimates that the Maui gas field may not be able to supply all the gas anticipated at the time the gas contract was signed in 1973. We have informed the Crown and the gas users (Contact Energy, Natural Gas Corporation and Methanex) who purchase from the Crown.

“The original contract was to supply the Crown with 4085 Petajoules of gas over a thirty year period from 1979 to 2009. Our new assessment is that developed and readily accessed undeveloped reserves in the field are likely to be around 3800 Petajoules. Consequently, depending on the rate of gas off-take the Maui field could be depleted around mid-2007 rather than the previously expected mid-2009.

“The Crown, Contact Energy, Natural Gas Corporation and Methanex were briefed on actions being taken to mitigate that situation. These include further technical studies aimed at quantifying the scope for additional gas recovery and preparations to advance in-field work aiming to improve economic recovery of the remaining gas in the field. MDL expects the feasibility of some of these initiatives to be clearer by end-March 2002.

“The gas industry will need to respond to this possibility with prudent action to mitigate the risks and bring on new gas supplies in a timely manner,” Dr Taylor said.

ENDS

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