AGL sells Papua New Guinea assets

AGL Energy has executed sales agreements for its Papua New Guniea oil and gas assets to an undisclosed international oil and gas company for a total of $1.1 billion (Aus.).

Oct 30th, 2008

Rick Wilkinson
OGJ Correspondent

MELBOURNE, Oct. 30 -- AGL Energy Ltd., Sydney, has executed sales agreements for its Papua New Guinea oil and gas assets, including a 3.6% stake of the $11 billion ExxonMobil Corp.-operated PNG LNG project, to an undisclosed international oil and gas company for a total of $1.1 billion (Aus.).

The sale is contingent on Papua New Guinea government approvals and is subject to preemptive rights where other PNG LNG joint venture parties can make a matching bid.

AGL expects the preemption process to take 30-45 days.

If successfully completed, the deal marks the end of AGL's noncore asset sale program that began in late 2007.

The transaction, along with the proposed sale of its stake in Queensland Gas Co. to BG Group earlier this week, gives AGL considerable balance sheet strength.

AGL's PNG assets other than the LNG project include an 11.9% interest in Kutubu oil field, 5.2% in Moran oil unit, 11.9% in Southeast Mananda development, 66.7% of Gobe Main oil unit, and 27.3% of Southeast Gobe unit.

AGL announced its intention to exit PNG early this year to concentrate on its core electricity generation business in Australia.

More in General Interest