|AMC's Stanwell development|
A spokesperson for the company said there was never any signed agreements between the pipeline consortium and Australian Magnesium Corp (AMC) for gas supply and that the needs of the $1.5 billion dollar plant were never factored into any plans.
The magnesium project is believed to be in more than $500 million debt following the collapse but there could be more serious repercusions for the proposed $6.5 billion dollar, 2,500km pipeline.
Currently Oil Search is striving to fill sufficient supply contracts to warrant development and is yet to receive a solid commitment from a number of buyers such as Comalco, Korea Zinc and the embattled Stanwell Power Station near Rockhampton.
The future of the Stanwell Power station is especially seen as one of the key points in future negotiations as it is potentially one of the pipelines' biggest Australian customers.
However, the station is linked to the Stanwell Australian Magnesium project, and has suffered due to a number of its own cost restructures and funding issues. Its future must now be clouded following the magnesium project's collapse and the loss of such a large potential contract must have repercussions for the pipeline.
Not according to Oil Search, which is still basking in the glory of its most successful year to date.