Pending a three month process, Santos will acquire 100 per cent of Eastern Star Gas Limited for $730 million and sell a 20 per cent working level interest in permits for $284 million to TRUnergy Holdings Pty Ltd, which recently purchased EnergyAustralia.

The acquisition builds on Santos’ existing permits in the Gunnedah Basin which includes the Upper Hunter Shire where there are currently seven exploration sites for coal seam gas.

With the Eastern Star Gas board of directors recommending the offer, Santos is confident the acquisition process will provide a good outcome and Santos will have the largest natural gas reserves position in NSW.

Once complete, the acquisition will mean Santos will take over all Eastern Star Gas exploration licences, including up to 550 gas wells, some based around the Pilliga State Forest, and the proposed gas pipeline stretching from Narrabri to Wellington via Coolah and the Upper Hunter.

Despite continuing concerns of the impact of coal seam gas exploration, which has seen a group of Queensland medical experts give evidence to a Senate committee on the risk of cancer and harm to unborn babies, coal seam gas companies are moving forward.

Santos Public Affairs principal adviser Sam Crafter said Santos previously had a 21 per cent state in Eastern Star Gas and had rights to 35 per cent of the exploration permits.

Mr Crafter said the acquisition would give Santos the ability to work across the whole basin and scale work so they can take the community along with them.

“We have a very long track record of working safely without causing environmental damage across Australia,” he said.

Mr Crafter said, as with all of Eastern Star Gas’ plans, they would review the proposed pipeline and were confident they can work with the community in establishing the line in the future.