Santos has signed a new long-term natural gas supply agreement with manufacturing and distribution company, Brickworks Limited, for their east coast operations until the end of 2024.
The supply agreement will provide Brickworks’ east coast operations with a flexible source of natural gas at competitive, stable, long-term prices. The natural gas contracted to Brickworks will supply their east coast operations in South Australia, Victoria, Queensland and New South Wales, with Santos supplying the gas from fields in the Cooper Basin. From 1 January 2020, Santos will supply up to 15 petajoules of natural gas over the life of the contract, allowing Brickworks to continue its focus on operational excellence.
Santos’ Managing Director and CEO Kevin Gallagher said this natural gas supply agreement is another demonstration of Santos’ commitment to secure the future of Australian manufacturing jobs.
“Santos is actively participating in the wholesale commercial and industrial market on the east coast, adding to competition in the domestic market and helping deliver more competitive natural gas prices and terms for Australian industry,” Mr Gallagher shared.
He also said that providing a wholesale supply option has helped deliver a better price outcome for Brickworks.
“Drilling more wells and lowering production costs – extracting more gas for less money – is the best way to keep downward pressure on gas prices,” he specified.
Brickworks said that they see significant advantages in sourcing supply from the wholesale market, which has delivered increased supply flexibility that has enabled it to better manage the variable nature of the brick production process.
“The new gas supply agreement with Santos provides our East Coast operations with flexibility and certainty of gas supply at competitive prices and will underpin our strong manufacturing position in Australia,” said Brickworks’ Managing Director, Lindsay Partridge.