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China seals long term energy agreements with Australia and Shell

Thursday, March 25th 2010 - 02:47 UTC
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Australia is playing a leading role as supplier of energy and minerals to China Australia is playing a leading role as supplier of energy and minerals to China

China National Offshore Oil Corporation, (CNOOC), signed a multi-billion dollar deal with Australia's BG Group to buy millions of tons of gas. Under the deal, which still needs government approval, CNOOC will buy 3.6 million tons of liquefied natural gas a year for the next 20 years.

Reports suggest the deal could be worth up to the equivalent of 73 billion US dollars. China's demand for gas is continuing to surge as its economy grows strongly.

“This deal is further evidence of Australia's vital role in global energy security in the 21st century” said the country's Resources and Energy Minister Martin Ferguson.

The 72 million tons of gas are due to come from BG's gas plant on Curtis Island.

The two companies agreed a preliminary deal last year. Earlier this month, CNOOC signed 3.1 billion USD for a 50% stake in Argentine oil and gas group Bridas Corporation.

In related news Royal Dutch Shell has strengthened its ties in China with a 30-year deal to explore for natural gas in the country.

The Anglo-Dutch energy giant will partner China National Petroleum Corporation (CNPC) in the project. The deal follows this week's joint bid with PetroChina, owned by CNPC, for Australia's Arrow Energy gas company.

Shell has been expanding its search for gas assets rapidly, and the deal secures the company a strong presence in resource-hungry China.

Under the agreement, which still needs clearance from the Beijing government, Shell and CNPC will initially search for gas in a 4,000 sq km area in the Sichuan province.

“The agreement will strengthen our partnership with CNPC in developing cleaner energy to meet China's growing needs,” said Malcolm Brinded, Shell's executive director of upstream operations.

On Monday Shell and PetroChina struck an agreed 3.1 billion USD takeover of Arrow Energy, a coal-seam gas company in Australia.

Shell and PetroChina already operate Changbei, a gas field in the Ordos Basin in Shaanxi province, which began commercial production in March 2007 and now supplies 3 billion cubic metres per year.

China is the world's second-largest oil and gas consumer after America, and has agreed a string of deals around the world to import resources.


Categories: Economy, Politics, International.

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  • Faulconbridge

    “Most of the casualties were Magellans and their own people believe it or not!”

    Hardly surprising. The Argentinian armed forces have killed more Argentinans than foreigners. In fact the Argentinian armed forces have also killed more Argentinans than foreigners have.

    Mar 30th, 2010 - 05:07 am 0
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