Equus Energy Finalises 10-Year Alcoa Supply Deal for Offshore WA Gas Project

Equus Energy (ASX: EQU) has signed a binding conditional 10-year Gas Sales Agreement (GSA) with Alcoa of Australia, establishing the aluminium producer as the foundation domestic customer for its Equus gas project off Western Australia.

Under the GSA, Equus will make about 50 terajoules per day of gas available to Alcoa following project start-up, equivalent to about 182 petajoules over the contract term and around 5% of the WA domestic gas market.

The agreement sits within a broader gas sales and funding arrangement that gives Equus access to up to US$30 million from Alcoa to support front-end engineering design (FEED) and progress towards a final investment decision (FID).

Equus has now moved into project partnering and commercialisation activities after the technical phase of pre-FEED confirmed a technically feasible and capital-efficient development concept.

Foundation Customer Secured

Alcoa is WA’s largest domestic gas user and its commitment provides Equus with a long-term foundation customer as the project moves through its next development stages.

The GSA also satisfies the Equus project’s domestic gas supply commitment under the state’s Domestic Gas Reservation Policy, giving the proposed development a defined domestic market component alongside its broader commercial strategy.

Equus plans to supply Alcoa from project start-up for the full 10-year term, with the contracted volume providing an anchor for a project designed to serve both domestic customers and LNG export markets.

“The execution of this major GSA with Alcoa demonstrates the strategic importance of the Equus gas project as a large, proven, and vital gas resource that can meet the shortfalls in WA’s domestic market and backfill spare LNG capacity on the North West Shelf,” managing director Will Barker said.

“With 100% ownership of the only independent, multi-trillion-cubic-feet gas resource on the North West Shelf, our focus is now on project partnering and commercialisation as we drive Equus to FID.”

Development Path Emerging

Pre-FEED work has supported a tie-back development using existing North West Shelf infrastructure, with Equus describing the concept as technically feasible, commercially robust and capital efficient.

The development is intended to access spare LNG processing capacity while supplying the WA domestic market, allowing Equus to pursue both local gas sales and LNG exports into Asia.

Equus owns 100% of the project, with the material assumptions and technical parameters underpinning its contingent resource estimates remaining unchanged.

Using existing infrastructure is expected to reduce development costs and accelerate the pathway towards development while maximising utilisation of available processing capacity.