ORIGIN Energy has agreed to sell more than $1 billion worth of Queensland coal seam gas to the Santos-led Gladstone LNG export project in further evidence the industry is struggling to develop enough early gas needed to feed $50 billion worth of planned export plants.
Origin will complete its own liquefied natural gas project with ConocoPhillips (COP) and China Petroleum and Chemical Corp later than Santos and the other major CSG-to-LNG proponent, BG Group.
But because it has shored up more gas reserves than its rivals, Origin is a position to get export prices for its gas earlier than its 2016 start date if it sells to Santos and BG, who appear to be having trouble getting the thousands of CSG wells needed to feed the plants up and running by 2015.
“The gas sales agreement with GLNG will deliver significant value to Origin, opening an export channel to market for our legacy fuel reserves and allowing a more rapid monetisation of the resource in line with international oil-linked pricing.,” Origin managing director Grant King said.
The Australian
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