China Petrochemical Corporation (Sinopec) has entered an agreement to acquire an additional 10% interest in the Australia Pacific LNG project on Curtis Island, near Gladstone, in Queensland, Australia.
The acquisition will increase the company’s ownership stake in the project from 15% to 25%, and will expand its existing purchase commitment from Australia Pacific LNG from 4.3 million tonnes of LNG per year to 7.6 million tonnes.
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Once the transaction is complete, the respective ownership interests of ConocoPhillips and Origin Energy in the LNG project will be reduced to 37.5%. Sinopec will also buy an additional 3.3 million tonnes of LNG a year from Australia Pacific LNG from mid-2015 to 2035.
Company chairman Fu Chengyu said that the new agreement with Australia Pacific LNG will help Sinopec ensure a long-term gas supply for the growing demand for LNG in the Chinese market. Sinopec signed agreements with Australia Pacific LNG in April 2011 for 4.3 million tonnes of LNG a year for 20 years from mid-2015 and for a 15% stake in the project.
Origin Energy chairman Kevin McCann said that with the marketing of the second train complete, Australia Pacific LNG is on track to make a final investment decision on the second train early this year.
The acquisition is subject to Australia Pacific LNG reaching a final investment decision on the second train, and approvals from the Chinese Government and Australian Foreign Investment Review Board.
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By GlobalData
