Comet Ridge (ASX: COCR) has taken full ownership and operational control of the Mahalo Gas Project (ATP 2044) in Queensland, Australia. This move aims to accelerate the supply of crucial gas resources to the undersupplied east coast Australian market. The company acquired Australia Pacific LNG's (APLNG) 30% interest and Santos's (ASX: STO) 40% interest, consolidating 100% equity in the project.
Comet Ridge secured its full ownership through two key acquisitions. The company first acquired APLNG's 30% stake for A$36.75 million. It funded this through a A$20 million placement and a A$20 million debt facility. Subsequently, Comet Ridge acquired Santos's 40% interest for A$20 million, utilizing existing cash and a new A$15 million facility. These transactions make Comet Ridge the sole owner and operator of the Mahalo Gas Project, which encompasses the entire Mahalo Gas Hub, covering approximately 1,850 square kilometers.
Comet Ridge is advancing the Mahalo Gas Project with a clear development strategy. The company plans a two-well drilling program, set to begin in late 2024. It aims for a Final Investment Decision (FID) in the first half of 2025. First gas production is targeted for 2026, with an initial output of 10 terajoules per day (TJ/day). The project has the potential to expand production to 30 TJ/day, or 10 petajoules (PJ) per year. The project boasts 2C contingent resources of 179 PJ and 3C contingent resources of 296 PJ.
The Mahalo Gas Project holds significant importance for the east coast Australian gas market, which faces ongoing supply shortfalls. By becoming a key independent gas producer, Comet Ridge aims to provide a substantial domestic gas supply. The project is considered "development ready" due to its proximity to existing pipelines and processing facilities. It also offers the advantage of low-cost development and operating expenses. Gas prices in Queensland currently stand at around A$7.50 per gigajoule (GJ), highlighting the economic viability of new supply. This consolidation of ownership is expected to streamline the project's development, ensuring a more efficient path to production.
Impact on Product and Chemical Commodity Prices
Comet Ridge’s full ownership of the Mahalo Gas Project is expected to accelerate natural gas production, improving supply security for Australia’s undersupplied east coast market. Increased domestic gas availability will support industries reliant on natural gas as both a fuel and feedstock, including ammonia, methanol, hydrogen, and petrochemicals. Over the medium term, improved gas supply could stabilize or reduce regional gas prices, lowering production costs for downstream chemical manufacturers. Consequently, ChemAnalyst-tracked commodities such as ammonia, methanol, hydrogen, and selected petrochemical intermediates may witness softer price pressure if additional gas volumes enter the market as scheduled, while enhanced feedstock availability strengthens overall industrial competitiveness.
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