Alcoa advances 10-year gas supply deal with USD 1.5m Equus funding in Western Australia

Alcoa has approved USD 1.5 million in funding for Equus Energy’s gas project in Western Australia, allowing the company to move into the second phase of development and begin work to secure key project partners.

The funding will support partnering activities as Equus seeks operating, LNG offtake, infrastructure and financing partners needed to advance the project toward front-end engineering design (FEED) and a final investment decision (FID).

The Stage Two approval follows Alcoa’s acceptance of the project’s Stage One pre-FEED deliverables. It also comes after Equus signed a binding 10-year gas sales agreement with Alcoa in August.

Equus said it has already started discussions with several strategic operating partners, which are reviewing the findings from the pre-FEED work.

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Alcoa deal secures long-term gas supply

Under the gas sales agreement, Equus will make around 50 terajoules of gas per day available to Alcoa. Over the 10-year contract period, this amounts to approximately 182 petajoules of gas.

Equus Managing Director Will Barker said Alcoa’s approval of the second phase represents another milestone for the project and strengthens its position as a potential future gas source for Western Australia.

"Alcoa’s approval of Stage Two is another important milestone for Equus, reinforcing the project’s position as a strategically important source of future gas supply for Western Australia," Barker said.

He pointed to declining North West Shelf gas production and the expected spare capacity at existing LNG facilities in the early 2030s as Western Australia looks for additional domestic gas supplies.

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"North West Shelf gas production is in steep decline, with existing LNG facilities facing significant spare capacity in the early 2030s at the same time as Western Australia requires new sources of domestic gas," Barker said.

Barker added that Equus has an independently certified gas resource and a development plan designed to make use of existing infrastructure.

"We have a large, independently certified gas resource, a capital-efficient development pathway that leverages existing infrastructure, and a binding 10-year domestic gas agreement with Alcoa," he said.

Phased development to use existing infrastructure

The Stage One pre-FEED work identified a development concept based on a phased tie-back. The plan would use a leased floating production, storage and offloading (FPSO) vessel, third-party pipeline infrastructure, and existing LNG and domestic gas processing facilities.

Equus said the work confirmed a technically robust and capital-efficient development pathway for the project.

With Stage Two funding now approved, the company will focus on identifying the operating, LNG offtake, infrastructure and financing partners required to move the project toward FEED and ultimately an FID.

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