PetroChina, Woodside deal ends
Source: Agencies/Shanghai Daily |
January 6, 2010, Wednesday
|
Print Edition
Print Edition
ENERGY giant PetroChina Co Ltd has pulled out of a US$40 billion deal to buy natural gas from a project off Australia, leaving Woodside Petroleum Ltd looking for new customers.
PetroChina said yesterday it exited the contract mainly because the Australian energy company was not able to supply liquefied natural gas on time, China Radio International reported.
Woodside informed the Australian Stock Exchange on Monday that an early-stage agreement for the Browse Basin liquefied natural gas project off Western Australia state had not been settled by a December 31 deadline and had now lapsed.
Under the September 2007 agreement, PetroChina would potentially buy up to 3.3 million tons of LNG per year for up to 20 years.
It was then one of Australia's largest export deals with an estimated worth of A$45 billion (US$40 billion).
Deals between prospective developers of the gas reserves on Australia's Northwest Shelf and customers have since accelerated, with companies in China, Japan and South Korea signing on to multibillion-dollar, two-decade agreements last year.
The lapse of the PetroChina deal means that the terms, including price, for a large chunk of the Browse Basin gas are open to negotiation.
"The deal was good at the time, but ... things have been changing rapidly," said Peter Kopetz, energy analyst with Western Australia-based State One Stockbroking.
PetroChina would probably look for other sources of gas, said Yang Wei, an oil industry analyst at Guotai Junan Securities in Shanghai, who also believes cost may have been a factor.
"I think it's probably that the price is not right. It's too expensive," he said.
PetroChina in August reached a US$41 billion deal to buy LNG from another project in the same region, being developed by Chevron.
Woodside said an agreement for CPC Corporation Taiwan to buy up to 3.3 million tons of LNG per year for up to 20 years from the Browse project was still in place, and the company was looking for more customers.
PetroChina said yesterday it exited the contract mainly because the Australian energy company was not able to supply liquefied natural gas on time, China Radio International reported.
Woodside informed the Australian Stock Exchange on Monday that an early-stage agreement for the Browse Basin liquefied natural gas project off Western Australia state had not been settled by a December 31 deadline and had now lapsed.
Under the September 2007 agreement, PetroChina would potentially buy up to 3.3 million tons of LNG per year for up to 20 years.
It was then one of Australia's largest export deals with an estimated worth of A$45 billion (US$40 billion).
Deals between prospective developers of the gas reserves on Australia's Northwest Shelf and customers have since accelerated, with companies in China, Japan and South Korea signing on to multibillion-dollar, two-decade agreements last year.
The lapse of the PetroChina deal means that the terms, including price, for a large chunk of the Browse Basin gas are open to negotiation.
"The deal was good at the time, but ... things have been changing rapidly," said Peter Kopetz, energy analyst with Western Australia-based State One Stockbroking.
PetroChina would probably look for other sources of gas, said Yang Wei, an oil industry analyst at Guotai Junan Securities in Shanghai, who also believes cost may have been a factor.
"I think it's probably that the price is not right. It's too expensive," he said.
PetroChina in August reached a US$41 billion deal to buy LNG from another project in the same region, being developed by Chevron.
Woodside said an agreement for CPC Corporation Taiwan to buy up to 3.3 million tons of LNG per year for up to 20 years from the Browse project was still in place, and the company was looking for more customers.
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