Thursday, May 3

Origin keeps its 'enemies' close

The 10-year deal Origin Energy has signed to supply gas to a rival export LNG project demonstrates the strength and value of the strategic position Origin has built through its development and acquisitions of eastern seaboard gas resources.

Origin has committed to supplying the GLNG consortium 365 petajoules of gas – 100 terajoules day – from 2015. The GLNG consortium of Santos, Petronas, Total and Kogas is building a $US16 billion two-train export LNG plant at Gladstone in Queensland which aims to produce 7.8 mtpa of LNG from 2015.

In 2010 Origin negotiated a 20-year deal with BG Group, which is also building a two-train gas liquefaction plant at Gladstone, targeting first production in 2014. Origin agreed to a 20-year deal to sell 190 petajoules of gas within jointly-owned fields to BG.

Origin itself, of course, is part of the APLNG consortium with ConocoPhillips and Sinopec which has committed to the first train of their own Gladstone LNG plant and which plans to make a decision on a second train by the middle of this year. If the second train gains financial investment decision approval it will be a $US20 billion project. It is also targeting mid-2015 for first gas from the plant.

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Business Spectator

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