Sinopec announces Australia Pacific LNG deal
Chinese oil giant Sinopec has announced an amended deal with Australia Pacific to buy 7.6 tonnes per annum (mtpa) of LNG through to 2035, up from 4.3 million (mtpa).
The companies also announced a Subscription Agreement that will see Sinopec subscribe for additional shares in Australia Pacific LNG, which will see its stake grow from 15 per cent to 25 per cent. As a result, ConocoPhillips’ and Origin Energy’s respective ownership interests will be reduced to 37.5 per cent.
“The Sale and Purchase Agreement with Australia Pacific LNG is an important part of Sinopec’s energy portfolio, and will help us to ensure long term gas supply for the growing demand in the Chinese market,” Chairman of Sinopec Mr Fu Chengyu said.
Origin Energy Chairman, Mr Kevin McCann AM said, “The extension of the existing LNG sales agreement between Australia Pacific LNG and Sinopec represents the largest LNG supply agreement in Australian history and is testament to the scale and quality of the project. With the marketing of the second train now complete, Australia Pacific LNG is on track to make a final investment decision on the second train in early 2012.”
In April 2011, Australia Pacific LNG and Sinopec signed a sales agreement for 4.3 mtpa of LNG for 20 years from mid-2015 and a Subscription Agreement in which Sinopec subscribed for a 15 per cent equity interest in Australia Pacific LNG. The first train of the project was sanctioned in July 2011, followed by the signing of a binding Heads of Agreement with The Kansai Electric Power Company (Kansai Electric) in November 2011 for the sale and purchase of approximately 1 mtpa of LNG for 20 years from 2016