01/06/2009 - 11:32

BP, Shell in Gorgon LNG deal

01/06/2009 - 11:32

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BP has entered a deal to sell gas from an offshore Western Australian gas field to Shell and then buy it back as liquefied natural gas after it has been processed through the Gorgon LNG project.

BP, Shell in Gorgon LNG deal

BP has entered a deal to sell gas from an offshore Western Australian gas field to Shell and then buy it back as liquefied natural gas after it has been processed through the Gorgon LNG project.

BP has agreed to sell gas from its 12.5 per cent stake in the Io gas field to Shell, which also holds a 12.5 per cent stake in the field. The remainder of the field is held by Chevron (50 per cent) and ExxonMobil (25 per cent).

Details of the purchase and sale agreements between BP and Shell have not been released.

In addition, all four companies have agreed to merge the Io field with the adjoining Jansz gas field, which is owned by Chevron (50 per cent), ExxonMobil (25 per cent) and Shell (25 per cent).

The merged gas field will be developed through the $50 billion Gorgon project.

Last month, Swiss company Agility Project Logistics secured a $250 million contract to supply base operations and transport services to support Gorgon while SKILLED Group was awarded a $350 million, three-year contract to supply marine vessels and labour.

 

 

BP's announcement is below:

 

Australian subsidiaries of BP, Chevron Australia, ExxonMobil and Shell have executed an agreement to enable the unitisation of the Io gas field with the Jansz gas field. The fields will be developed via the Gorgon liquefied natural gas (LNG) Project.

BP and Shell have also agreed a Petroleum Sale and Purchase Agreement and an LNG Sale and Purchase Agreement. These arrangements set out the terms and conditions by which BP will sell petroleum to Shell, and purchase it as LNG cargoes after it has been processed through Gorgon LNG infrastructure.

Phil Home, Managing Director of BP's exploration and production business in Australia said, "We are delighted to have reached this important agreement which will help unlock the value of Io gas."

 

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