New deal near for sale of Gorgon LNG

Eric Watkins
Senior Correspondent

LOS ANGELES, Dec. 8 -- Chevron Australia Pty. Ltd. and Japanese power company Osaka Gas Co. Ltd. have signed a heads of agreement for the sale of 1.5 million tonnes/year of LNG from Gorgon project in Australia over a period of 25 years, beginning in 2010.

Chevron's announcement did not disclose terms of the deal, but the firm said the parties are also discussing the potential transfer of an equity interest in the Gorgon project—an arrangement similar ones it has made with other Japanese power companies.

The agreement with Osaka follows one struck by Chevron in November to sell 1.5 million tonnes/year of LNG to Chubu Electric Co. from the Gorgon development, and another one struck by Chevron in October to sell 1.2 million tonnes/year of LNG to Tokyo Gas Co. (OGJ, Nov. 28, 2005, Newsletter).

Gas for the project will come from the Gorgon complex of fields 130 miles off Western Australia (see map, OGJ, Oct. 17, 2005, p. 35).

Contact Eric Watkins at hippalus@yahoo.com.

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