Arrow board accepts revised Shell-PetroChina bid

Arrow Energy Ltd.’s board accepted an increased offer from Shell Energy Holdings Australia Ltd. and PetroChina International Investment Co. Ltd. to acquire Arrow.

Rick Wilkinson
OGJ Correspondent

MELBOURNE, Mar. 22 -- Arrow Energy Ltd.’s board accepted an increased offer from Shell Energy Holdings Australia Ltd. and PetroChina International Investment Co. Ltd. to acquire Arrow.

The latest bid was $3.4 billion (Aus.), up 6% from an earlier offer Shell and PetroChina made for the Brisbane coal seam methane gas (CSM) company. The move marks another step by the majors into the CSM-LNG projects in Queensland (OGJ, Mar. 15, 2010, Newsletter).

The offer remains subject to approval of Arrow shareholders during a July meeting. If approved by them and Australia’s Foreign Investment Review Board, the resulting joint venture, CS CSG (Australia) Pty Ltd., would be owned 50:50 by Shell and PetroChina.

Arrow’s main Australian assets, Surat-Bowen basin coal seam gas and its power business, are being sold to CS CSG. That joint venture also will hold Shell’s proposed Curtis Island CSG-LNG plant. Meanwhile, a new company called Dart Energy is being formed to hold most of the demerged international assets of Arrow plus some of Arrow’s shareholdings in other Australian companies and Arrow’s $45 million cash.

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