Four projects are to be funded from the second round of PACE Gas, potentially leveraging more than $70 million in private investment to find new South Australian gas supplies.

The successful PACE Gas Round 2 grant recipients are:

  • $6.89 million for the Santos-Beach Cooper Basin project to deploy a heat-energy recovery system to offset natural gas used to run the Moomba petroleum processing plant
  • $5.26 million for the Senex Cooper Basin Gemba exploration/appraisal project
  • $6.89 million for Beach /Cooper Energy’s Dombey project in the Otway Basin
  • $4.95 million to the Rawson/Vintage Nangwarry project in the Otway Basin


PACE Gas was designed as part of a suite of measures including the new Royalty Return program to increase investment in local gas production and to ease price pressures in South Australia.

Gas extracted through PACE Gas must first be offered to local electricity generators, enhancing the affordability of supply and putting downward pressure on power prices.

PACE Gas Round 2 attracted 15 applications from 11 companies. In both grant rounds, applications were thoroughly assessed by an expert panel, including independent advisers.

PACE Gas round 1 also awarded $24 million in grants to projects in South Australia.

The recent Fraser Institute Global Petroleum Survey 2017 cited South Australia as the best jurisdiction for oil and gas investment in Australia and in the southern hemisphere. South Australia also ranked third best in world in our reserve category, and tenth best in world for attractiveness for exploration and development investment in oil and gas projects.

Quotes attributable to Mineral Resources and Energy Minister Tom Koutsantonis

There is a gas supply shortfall in Australia, driven in part by reckless and unscientific bans and moratoria on exploration and development in other jurisdictions.

In South Australia we want to boost supply to put downward pressure on both gas and power prices, which is why we are partnering with these leading companies to explore for and unlock reserves of gas in the Cooper and Otway basins.

These are highly prospective regions, which is why there was so much interest in this second round of PACE Gas grants.

The key to lowering prices is encouraging companies to invest in innovative new methods of bringing forward production now to meet the tight market across the east coast.

There is enough gas in the ground in South Australia to power our grid for centuries.

My message to gas companies around Australia is that in South Australia we want to drive investment in this sector and will work with proponents to discover and extract more gas.

Quotes attributable to Santos MD and CEO Kevin Gallagher

I’m delighted that the South Australian Government has supported our application for a PACE grant to install a heat-energy recovery system at the Moomba petroleum processing plant.

This project will increase gas supply for the domestic market by reducing Santos’ own energy consumption in production and processing. It has the added advantage of lowering carbon emissions from our gas processing activities.

We are always looking for ways to reduce energy consumption and our carbon footprint, particularly in the Cooper Basin where our own energy use is equivalent to just under 5 per cent of east coast domestic gas demand. If we can make even half that gas available to the market by capturing energy efficiency opportunities over time, it would be an excellent outcome for both Australian customers and LNG exports.

Quotes attributable to Senex Managing Director and CEO Ian Davies

The South Australian Government continues to deliver innovative solutions to drive upstream investment and bring new gas volumes to market for the benefit of local customers.

Senex is delighted to work with the government on this important initiative.

Quotes attributable to Beach Energy CEO and MD Matt Kay

We are pleased to once again receive support from the South Australian Government to explore for gas in the onshore Otway Basin.

This support is crucial in helping identify and develop new gas resources for South Australia.

Beach will continue to work with the local community throughout the planning, drilling and post completion phases of this drilling activity.

Quotes attributable to Rawson Chairman Allister Richardson

We are looking forward to testing this prospect with the drill bit and we are confident it can bring new gas to the market.

It is encouraging to see the recent drilling success and PACE awards pointing to a positive outlook for the onshore Otway Basin.

I would like to acknowledge the support the South Australian Government has provided with PACE and we look forward to advancing gas exploration in South Australia.

Quotes attributable to Vintage MD Neil Gibbins

The successful application for the PACE grant from the South Australian Government Is a great boost for Vintage as we develop our portfolio of energy assets and move towards a planned future Initial Public Offering.

The support of the SA Government for new energy ventures such as Vintage, is crucial for the future development of the industry.

Vintage believes South Australia continues to have very high prospectivity for new oil and gas discoveries and we aim to bring our experience to bear to help unlock the state’s energy potential.