Under the MOU, the project participants have agreed on the key terms and conditions for processing gas from the Kipper field through Esso and BHP Billiton's infrastructure and processing facilities in Gippsland.
In addition, under the MOU, agreement has been reached on revised equity shares in the project. The ownership structure of the Kipper project will be: Esso 32.5 percent, BHP Billiton 32.5 percent, Woodside 21 percent and Santos 14 percent.
ExxonMobil Australia Chairman Mark Nolan noted that the signing of the MOU was an important project milestone.
"Signature of the MOU represents a significant achievement for the Kipper gas project. It marks the culmination of extensive examination of the best development plan for Kipper, after a seismic survey in 1999 and an appraisal well drilled in 2002 confirmed a resource of approximately 620 billion cubic feet of recoverable gas and 30 million barrels of condensate/LPGs.
It is expected that the Kipper field will be developed by installation of a number of subsea wells and associated pipeline infrastructure. Kipper gas would then be piped through Esso and BHP Billiton infrastructure and processing facilities.
Mr. Nolan also confirmed that Esso Australia would operate the Kipper development on behalf of the joint venture and that front-end engineering and design was expected to commence in the first half of 2006. Esso Australia will also commence all relevant approvals on behalf of the project.
The Kipper field is located in 100 meters of water, approximately 45 kilometers from Ninety Mile Beach on the Gippsland coast.
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