The two “Christmas trees” – as the petroleum industry calls the sub-sea well-control equipment associated with the sub-sea production system – are integral to the $200 million Casino gas project, in the offshore Otway Basin, Victoria.

In mid-February 2005, the sub-sea trees will be installed in about 70 metres of water, about 30km off Port Campbell on the Victorian coast.

Over a two-day installation period, the trees – which weigh about 30 tonnes each, and measure about 3 metres x 4 metres – will be installed on wellheads as part of the offshore drilling program.

Once operational, they will regulate the flow of gas from the subsea wells to an onshore processing facility at Iona, operated by SPI Electricity Pty Ltd.

The subsea system has been constructed by international engineering firm, Cooper Cameron Pty Ltd, at its Singapore and German manufacturing plants and shipped to the Deer Park facility for testing before installation.

SPI Electricity has signed a contract with the joint venture partners to be supplied with up to 420 petajoules (PJ) of gas from Casino over 12 years, for the Victorian and South Australian markets.

In addition, the contract allows for the joint venture partners to process a further 105 PJ of gas (above and beyond the 420 PJ) over a further three years at SPI Electricity’s Iona plant in Victoria.

The combined agreements could be worth up to $1.7 billion to the joint venture partners, dependant on future exploration success.

Gas production is expected to start in the first quarter of 2006.

Planned annual production is expected to plateau at 35 PJ per annum based on Proven plus Probable gas reserves (2P) of 285 PJ.

Interests in VIC P/44 are Santos Limited (operator) 50%, Peedamullah Petroleum Pty Ltd (wholly-owned subsidiary of AWE) 25% and Mittwell Energy Resources Pty Ltd (wholly-owned subsidiary of Mitsui) 25%.