BG Group has completed transactions with China National Offshore Oil Corporation (CNOOC) for the sale of additional interests in the Queensland Curtis LNG (QCLNG) project in Australia for US$ 1.93 billion. Under a separate agreement, BG Group will also supply CNOOC with an additional five million tpa of liquefied natural gas (LNG).
CNOOC has also reimbursed BG Group for QCLNG project expenditure in line with its increased interests incurred from 1 January 2012 to 30 September 2013.
BG Group CEO Chris Finlayson commented: "While today marks the completion of the agreements with CNOOC, it also signals the start of a new chapter in our partnership as we begin commissioning of the world's first coal seam gas to LNG project ahead of first commercial cargo in 2014.
"Our relationship with CNOOC has grown as they increase their investment in our QCLNG project and BG Group becomes the largest supplier of LNG to the world's fastest growing energy market.”
The key terms of the transactions are:
- BG Group will sell certain interests in upstream coal seam gas tenements in Australia and a further equity stake in the QCLNG project Train 1 liquefaction facility;
- BG Group will supply CNOOC with a further 5 million tpa of LNG for 20 years beginning in 2015;
- CNOOC will acquire a 40% equity interest in QCLNG Train 1, increasing its equity ownership from 10% to 50%;
- CNOOC will acquire a 20% interest in the reserves and resources of certain BG Group tenements in the Walloons Fairway region of the Surat Basin, Queensland, increasing its ownership from 5% to 25%;
- CNOOC will acquire a 25% equity interest in certain other upstream tenements held by BG Group in the Surat and Bowen Basins, Queensland;
- BG Group and CNOOC will jointly invest in the construction of two LNG ships in China, adding to the two ships already committed under the LNG agreements signed in ?March 2010; and
- CNOOC will have the option to participate up to 25% in one of the potential expansion trains at QCLNG.
The agreements exclude any interest in the Train 2 liquefaction facility, transmission pipeline and QCLNG project common facilities.
BG Group's Australian business, QGC Pty Limited, remains operator and retains majority ownership of the QCLNG project. In particular, BG Group will have:
- Around 74% of its original interest in the upstream resource and related infrastructure; and
- 100% of the project's common facilities on Curtis Island (including LNG storage tanks and jetty) and the 540 km natural gas pipeline network linking the gas fields to Curtis Island.
Adapted from press release by Katie Woodward
Read the article online at: https://www.lngindustry.com/liquid-natural-gas/11112013/cnooc_completes_lng_transactions_412/