WestSide Corporation Limited (ASX:WCL) Strikes Flexible Gas Market Swap Deal

Brisbane, Dec 23, 2011 AEST (ABN Newswire) - WestSide Corporation Limited (ASX:WCL) and Meridian SeamGas joint venture partner Mitsui E&P Australia Pty Ltd (Mitsui) have today executed an agreement to fast-track access to gas to aid fulfilment of existing contracts and reduce payments to remedy shortfalls.

The agreement with a leading market participant provides the Meridian SeamGas joint venturers with flexibility on borrowed gas volumes during 2012 to complement increasing production.

Under the agreement, WestSide will purchase gas to help meet demand from existing customers supplied by Meridian SeamGas. WestSide will subsequently sell the same volume of gas back to the supplier by the end of 2015.

WestSide Chief Executive Officer Dr Julie Beeby said the agreement enabled the Meridian SeamGas joint venturers to fast track access to gas to help meet two sales contracts to supply an aggregate total of 25 Terajoules a day (TJ/d).

"By bringing forward this capacity to meet our gas sales commitments, WestSide is also positioned to reduce the payment of remedies factored into the price the Company originally paid for its 51 per cent interest in Meridian SeamGas," Dr Beeby said.

Under the inherited production rate, Meridian SeamGas has been unable to supply its gas sales agreements in full. A balance sheet provision in Westside's 2011 accounts covering this liability was based on the conservative assumption that the shortfall would remain for the life of the contract.

Dr Beeby said completion of the gas swap at the end of 2015 was timed to match the potential commencement of many opportunities for gas sales to domestic customers and Liquefied Natural Gas (LNG) export projects being developed at Gladstone in Queensland.

"This flexible gas swap arrangement will help Meridian SeamGas ramp up production to match requirements to secure larger volume, long-term gas supply contracts," Dr Beeby said.

Contact

Dr Julie Beeby Chief Executive Officer WestSide Corporation Ltd Tel: +61-7-3020-0900 Investors and Media Richard Owen Investor & Community Relations Manager WestSide Corporation Ltd Tel: +61-7-3020-0900 Mob: +61-412-869-937 Email: richard.owen@westsidecorporation.com