Domestic gas supply deal to shore up Mount Isa industry and bring 240 jobs

Published Thursday, 15 February, 2018 at 12:43 PM

Minister for Natural Resources, Mines and Energy
The Honourable Dr Anthony Lynham


A new deal between zinc producer New Century Resources and Santos was signed today which will generate 240 jobs and bring further certainty to Mount Isa’s resources industry.

Minister for Natural Resources, Mines and Energy Dr Anthony Lynham said the contract would see Santos supply around 9 petajoules of gas to meet the electricity demands of New Century Resources tailings operation near Mount Isa, securing the energy needs to produce high-grade zinc concentrate.

“We know that gas supply is a critical factor when businesses make decisions about when and where they invest, expand and create jobs,” Dr Lynham said.

“This investment in our regions, which is worth in the order of $100 million, is evidence that Queensland has the right policy settings to drive investment to our regions.

“The agreement with Santos means that from July, New Century will have enough electricity to produce half a million tons of zinc concentrate annually from its industry leading economic rehabilitation project.

“This is a massive shot in the arm for the State’s North West and its minerals province,” Dr Lynham said.

New Century Utilities Manager Michael Pitt said the company was very pleased with the Santos Gas Supply Agreement, which not only provided the required gas supply volumes for restarting operations but also significant flexibility during ramp up at the mine.

“After a highly competitive tender process for the supply of gas, we are thrilled to have entered into a long term contract with our partners at Santos and look forward to a strong working relationship as we transition into full operations at Century.”

Dr Lynham said the Palaszczuk Government was continually working to deliver more gas for domestic consumers to ease pressure on gas-dependent manufacturing industries.

“We know the solution to gas shortages is more gas, and we are driving the exploration and development of new gas fields by releasing land for gas production on the condition that the gas can only be sold to Australian customers.

“Queensland’s domestic gas policy is sending a consistent message to the market and provides a practical means of producing more gas for the Australian market.

"We will continue to deliver on our election commitment to release more land for gas for the domestic market. In 2017, we released a 58sq km block of land for tender in the Surat Basin for gas for the Australian market only.

“A further two parcels totalling 395sq km were released in September and I hope to announce the preferred tenderers very soon.

Santos Executive Vice President Marketing and Trading, Mr Phil Byrne said Santos was delighted to have been selected to supply gas for New Century’s world class Century Zinc Mine.

“Santos is absolutely committed to working in partnership with Australian industry to deliver competitively-priced domestic gas and this is a great example of that commitment,” Mr Byrne said.

“Santos appreciates the tremendous support of Minister Lynham and the Queensland government for the gas industry and the benefits it brings in terms of jobs, investment and economic sustainability for regional Queensland communities and for the state.”

“I thank New Century Resources and Santos for their continued belief in Queensland,” Dr Lynham said.

“This commitment brings welcome investment and jobs to our regional industries and communities.”


Media contact: David Potter 0428 411 617