Queensland Pacific Metals announces Moranbah Project acquisition

Queensland Pacific Metals Limited has sensationally revealed it has entered into a conditional agreement to acquire 100% of the Moranbah Project’s assets.

The company’s wholly-owned subsidiaries, collectively known as (QMPE), have entered into a binding Asset Sale Agreement (ASA) to acquire the Moranbah Project from the Arrow Energy Group and AGL Energy Ltd. This development signifies a major milestone for QPM, achieving vertical integration of the energy supply chain for the company’s TECH Project. The move de-risks TECH Project operations by securing a long-term, economical gas supply.

Completion of the ASA is subject to several customary conditions typical of this type of transaction. It will require indicative approval from the Minister to transfer Petroleum Titles, the replacement of rehabilitation security for the Environmental Authorities and secure the approval of the counterparties to the novation or assignment of specific material contracts. QPME will pay $5m to acquire 100% of the Moranbah Project and obtain warehouse inventory related to its operations.

Dr Stephen Grocott, the Managing Director and CEO of Queensland Pacific Metals, commented: “Vertical integration of our energy supply chain for the TECH Project is a significant de-risking event that cannot be underestimated. This transaction is yet another commercial arrangement that the management team of QPM has been able to orchestrate to bring us one step closer to the construction of the TECH Project and to deliver value for shareholders.”

What is the Moranbah Project?

The Moranbah Project is located approximately 390km south of Townsville. It is the only currently producing gas field in the Northern Bowen Basin (NBB) that can supply gas to North Queensland consumers. The project has been in production since 2004. Current gas production is sourced from approximately 100 operated wells across four Petroleum Leases and waste mine gas supplied from five active coal mines in the region.

The Moranbah Project has the infrastructure to supply up to 30 PJ of gas per annum, including gas processing and compression facilities connected to the NQGP for transportation through Townsville and the TECH Project. The 2023 calendar year gas production is forecast to be at least 10 PJ.

Moranbah Project
Figure: Project Location – Moranbah to Townsville. Credit: Queensland Pacific Metals Limited

How will the acquisition benefit the TECH Project?

The 100 producing wells and associated gas gathering and water management infrastructure will supply a centralised gas processing and compression facility connected to the North Queensland Gas Pipeline (NQGP), which runs adjacent to the TECH Project. Additionally, the Moranbah Project has direct connections to five operating metallurgical coal mines to capture and process mine waste gas, with the ability to connect additional NBB mines quickly. Therefore, it will significantly reduce carbon emissions from these sites.

There is also a Gas Transport Agreement (GTA) with NQGP for gas transportation and storage from the Moranbah Project to Townsville. THE NQGP can transport up to 39 PJ per annum. Moreover, the acquisition includes a Power Purchase Agreement (PPA) with the 242 MW Townsville Power Station for 100% capacity rights to toll gas and generate revenue by producing electricity for sale into the National Electricity Market (NEM).

The move is exceptionally strategic for Queensland Pacific Metals and its energy supply chain through developing carbon abatement hubs in the NBB. By pioneering a vertically integrated energy supply chain, the company is uniquely positioned to create significant value from the Moranbah Project. It will also enable the coal industry to reduce its carbon emissions in line with the Australian Government’s recently passed Safeguard Mechanism reform through the beneficial use of waste mine gas.

QPM Energy Pty Ltd Chief Executive Officer David Wrench concluded: “The potential of the Moranbah Project and QPME’s Carbon Abatement Strategy is enormous, and via our collection Hubs, the Northern Bowen Basin is well positioned to become a major energy supplier to Northern Australia. This potential is further reinforced by the strong tailwinds we are experiencing from Australian Government reform for carbon emissions reductions and the growing global need and acceptance to utilise gas to facilitate the successful energy transition.”

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Contributor Details

Dr Stephen Grocott

Managing Director & CEO
Queensland Pacific Metals Limited
Phone: +61 7 3517 5900
Website: Visit Website

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