The Australian Competition and Consumer Commission announced this morning it would not oppose the deal.
Santos Managing Director and CEO Kevin Gallagher said the acquisition meant the Adelaide-headquartered oil and gas giant was in a better position to become Australia’s leading supplier of domestic natural gas.
Quadrant Energy discovered a huge oil deposit at its Dorado well off the Western Australian coast earlier this year.
“We already have very significant growth projects across our five core assets (the Cooper Basin, southeast Queensland, Papua New Guinea, Northern Australia and WA gas) and Quadrant’s recent oil discovery at Dorado is another exciting opportunity for us,” Gallagher said.
ACCC Chair Rod Sims said this morning that an investigation had found the acquisition was unlikely to substantially reduce competition in the domestic gas market.
“The ACCC considers that a combined Santos/Quadrant will continue to face strong competition from a range of suppliers, including large LNG producers such as Chevron and Woodside,” said Sims.
“Most market participants believe the Western Australian domestic gas market is currently oversupplied.
“While the demand-supply balance could tighten in future, the ACCC considers that the proposed acquisition will not have a significant impact on future gas prices.”
He added that: “In Western Australia, gas exporters are required to reserve 15 per cent of their gas for the domestic market, so this should ensure that gas available for domestic customers continues to grow, and from a range of players.”
The ACCC had Western Australian Government departments to comment on the deal, but they expressed no objections to it.
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