First Shipment of HDNG
Brisbane, May 20, 2024 AEST (ABN Newswire) - State Gas Limited (
ASX:GAS) (STGSF:OTCMKTS) has successfully shipped its first cargos of high-density natural gas ("HDNG") using its Virtual Pipeline trailers. These are the first shipments of HDNG under the offtake arrangement announced on 5 April 2024, that will see State Gas' HDNG used in the ongoing trial of hybrid (diesel/natural gas) mine-truck engine technology at a major coal mine in Central Queensland.
HDNG volumes will increase progressively over coming weeks in parallel with the ramp up of gas production from State Gas's HDNG Facility and the efficient integration of the hybrid truck engines into the operating mine-truck fleet at the customer's site.
The provision of HDNG is a bundled gas supply solution, which reflects significant value when compared to raw natural gas sourced from the traditional pipeline network. The ability to supply flexible quantities of natural gas to locations remote from traditional pipeline infrastructure means that State Gas' HDNG will be at a sustainable premium to the spot price of raw pipeline gas.
The HDNG technology developed by State Gas provides the Company with significant first mover advantage in providing alternative fuel sources to diesel, as part of reducing the emission profile of various industrial activities. Natural gas has lower carbon content than diesel and produces around 25% less CO2 per unit of energy during combustion. In addition, natural gas contains significantly lower levels of other harmful particulates when compared with diesel. The State Gas HDNG plant also provides a reliable method for capturing and commercialising production testing gas which has historically been released to the atmosphere.
Since commissioning of the HDNG plant, State Gas has received unsolicited inquiries for, not only the supply of HDNG, but also the wider application of its HDNG technology to support a variety of diesel substitution applications.
State Gas' Executive Chairman, Mr Richard Cottee said, "The task of delivering innovation of this scale in the CSG industry has posed challenges in both time and cost. However, in the HDNG Facility, the Company has created an asset of substantial strategic and commercial value. State Gas has brought to market a flexible fuel source at a time when environmentally superior alternatives to diesel are urgently required. We believe supporting diesel substitution in the coal industry is the first of many potential largescale applications of HDNG. In conjunction with the recently announced exploration grant funding, State Gas is now extremely well positioned to deliver improved returns to shareholders, by generating initial cashflow from its existing assets but, more importantly, through becoming a credible energy and technology provider."
State Gas' Chief Executive Officer, Mr Doug McAlpine said, "Success from the fully funded exploration program announced by the Company last week, means that additional production testing gas will likely be available for HDNG production and sales early next calendar year. This will allow State Gas to meet increasing demand for HDNG."
About State Gas Limited
State Gas Limited (ASX:GAS) (OTCMKTS:STGSF) is a Queensland-based gas exploration and development company with highly prospective gas exploration assets located in the southern Bowen Basin. State Gas Limited's mission is to support east coast energy markets through the efficient identification and development of new high quality gas assets.
It will do this by applying an agile, sustainable but low-cost development approach and opportunistically expanding its portfolio in areas that are well located to gas pipeline infrastructure.
State Gas is 100%-owner of the contiguous Reid's Dome (PL-231) and Rolleston-West (ATP 2062) gas projects, both of which contain CSG and conventional gas. The Projects, together some 1,595km2 , are located south of Rolleston, approximately 50 and 30 kilometres respectively from the Queensland Gas Pipeline and interconnected east coast gas network. State Gas intends to accelerate commercialisation of these assets through the application of an innovative virtual pipeline ("VP") solution which will see the Company transport compressed gas by truck to existing pipeline infrastructure or to an end user.
State Gas also holds a 35% interest in ATP 2068 and ATP 2069 in joint venture with Santos QNT Pty Ltd (65%). These two new areas lie adjacent to or in the near vicinity of State Gas and Santos' existing interests in the region, providing for the potential of an alignment in ownership interests across the region over time and enabling synergies in operations and development.
State Gas is also participating in a carbon capture and sequestration initiative with minerals explorer Rockminsolutions Pty Ltd in respect of EPM 27596 which is located on the western border of ATP 2062. This project is investigating the potential of the unique basalts located in the Buckland Basaltic Sequence (located in EPM 27596) to provide a variety of in-situ and ex-situ carbon capture applications.
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