Mereenie - LOI for Long Term GSA supported by two new wells
| Stock | Horizon Oil Ltd (HZN.ASX) |
|---|---|
| Release Time | 15 Dec 2025, 10:02 a.m. |
| Price Sensitive | Yes |
Horizon Oil signs LOI for Mereenie gas supply
- Binding LOI with Northern Territory's Power and Water Corporation
- Accelerated drilling program for two new Mereenie wells
- Long-term gas supply agreements through 2034 under conditional term sheets
Horizon Oil Limited (ASX: HZN) and its Mereenie Joint Venture partners have entered into a binding Letter of Intent (LOI) with the Northern Territory's Power and Water Corporation (PWC) to support the immediate commencement of early works for an accelerated drilling program of two new wells at the Mereenie field, and to promptly document and execute gas supply agreements consistent with conditional gas supply term sheets that will see uncontracted firm gas production from Mereenie sold through to 2034. The JVs will immediately begin early works for the two-well drilling program, including ordering long-lead items, progressing civil works, and selecting a drilling rig, with drilling targeted to commence in mid-2026. The JVs and PWC have also finalised 'in-principle' terms for long-term, firm gas supply under term sheets covering uncontracted firm gas production from the Mereenie field through to 2034, including additional production from the two-well program. The intention is for the parties to formalise and execute binding Gas Sale Agreements (GSAs), consistent with these term sheets, by 20 February 2026. Arrangements have been agreed under the LOI where the JVs can be reimbursed by PWC for costs associated with the drilling program's early works in the event binding GSAs are not executed by 20 February 2026. The intended supply arrangements are designed to quickly deliver significant new gas volumes to the Northern Territory, while also enhancing gas supply security for customers throughout the region.
The gas supply term sheets cover uncontracted firm gas production from the Mereenie field through to 2034, including additional production from the two-well drilling program.
The accelerated drilling program and long-term gas supply agreements will support the Northern Territory's gas demand from the middle of 2026 onwards.