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PetroChina buys stake in LNG project
By Richard Fu |
December 13, 2012, Thursday
|
Print Edition
Print Edition
PETROCHINA Co has agreed to pay US$1.63 billion to BHP Billiton for a minority stake in a proposed liquefied natural gas project in Australia as the Chinese company aims to boost overseas output.
PetroChina will acquire 8.33 percent in the East Browse joint venture and 20 percent in the West Browse venture, BHP said in a statement yesterday.
Together, PetroChina will own 10 percent of the Browse LNG project, according to Neil Beveridge, analyst at Sanford C. Bernstein.
J. Michael Yeager, the chief executive for petroleum at BHP, the world's largest mining company, said the purchase "is an excellent opportunity for both companies. PetroChina has acquired an interest in a world class gas resource, and BHP Billiton has exited a non-strategic asset."
The Browse project, located offshore Western Australia, is the largest stranded gas project remaining in Australia and has been left idle for two decades since it was discovered.
Beveridge said that for the stranded partners of the project, PetroChina's entry is a "clear positive" as development is now likely, but the deal seems expensive for PetroChina compared with what the Japanese companies paid earlier this year.
"The decision by PetroChina to pay a high price for entrance to a stranded high cost LNG development indicates a lack of confidence in alternative supplies being available," Beveridge pointed out.
PetroChina will acquire 8.33 percent in the East Browse joint venture and 20 percent in the West Browse venture, BHP said in a statement yesterday.
Together, PetroChina will own 10 percent of the Browse LNG project, according to Neil Beveridge, analyst at Sanford C. Bernstein.
J. Michael Yeager, the chief executive for petroleum at BHP, the world's largest mining company, said the purchase "is an excellent opportunity for both companies. PetroChina has acquired an interest in a world class gas resource, and BHP Billiton has exited a non-strategic asset."
The Browse project, located offshore Western Australia, is the largest stranded gas project remaining in Australia and has been left idle for two decades since it was discovered.
Beveridge said that for the stranded partners of the project, PetroChina's entry is a "clear positive" as development is now likely, but the deal seems expensive for PetroChina compared with what the Japanese companies paid earlier this year.
"The decision by PetroChina to pay a high price for entrance to a stranded high cost LNG development indicates a lack of confidence in alternative supplies being available," Beveridge pointed out.
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