AUSTIN Exploration’s gas processing plant at its Pathfinder property in Colorado officially started production in August

The plant will extract heavy liquids from the gaseous product and also ready the wells to produce pipeline quality methane gas.

Earlier this year, the Melbourne-based company executed a gas processing agreement with Gas Processing of America (GPA) which will see it process and sell heavy liquid gases, including propane, hexane, ethane, and butane. This will allow the methane to be sold as pipeline quality gas while optimising development of the company’s Pathfinder property.

GPA outlaid the capital to install the processing plant, compression plant and the associated infrastructure, and will act as owner/operator, gather and transport the gas, maintain the plant, and market and sell the gas, with Austin to receive an equitable share of proceeds from the sale of the gas.

The details of this agreement between Austin and GPA remain confidential.

“This is a significant milestone in the large scale development of our flagship Pathfinder property in Colorado, as it delivers early stage revenue from the project,” Austin chief executive and managing director Dr Mark Hart said.

“The successful installation of our processing plant is a critical component for the commercialisation of the significant amount of gas reserves contained within this property.

“Austin remains focused on delivering stable revenue streams from its operations, and the proceeds of gas sales from Pathfinder will be a significant contribution towards this.”

Meanwhile, discussions are also progressing to install a main north-south gas pipeline to connect the Pathfinder field to the main Colorado Interstate gas pipeline which is expected to unlock maximum profitability for the field, which has more than 200 potential drilling locations.