Australia's Liquefied Natural rekindles gas supply talks with PetroChina

By JAMES PATON
Bloomberg

Liquefied Natural Gas Ltd. is rekindling talks with PetroChina for the supply of gas to its stalled export project in Australia after signing up its first supplier.

Liquefied Natural wants to revive the $1.7 billion Fisherman’s Landing project, which has been on hold since the start of the decade pending a gas-supply agreement. The fuel is liquefied for shipment to Asia on tankers.

Managing director Maurice Brand said his company is seeking to restart talks with PetroChina, which signed a letter of intent in 2012 to help secure gas for the project.

“We will accelerate those discussions appropriately moving forward,” Brand said today in an interview after announcing an initial deal with Tri-Star Petroleum Co. for supplies to underpin production of 1.5 million tpy of LNG.

Calls to PetroChina’s public relations office in Beijing weren’t answered.

PetroChina’s parent, China National Petroleum Corp., owns about 2.2% of Liquefied Natural shares through a unit. PetroChina is part owner of Australia’s Arrow Energy and acquired Molopo Energy’s coal-bed methane holdings in 2012.

Liquefied Natural’s market value in Sydney trading has surged to A$1.72 billion ($1.51 billion) from about A$100 million at the start of 2014. It closed 5.1% higher at A$3.72 in Sydney.

The company is also holding talks to supply LNG buyers in Asia.

“We’re very encouraged by the strong interest from the parties we’ve spoken to,” Brand said, declining to identify any customers.

The company is targeting “traditional parties” as well as “people wanting access to well-priced LNG who aren’t in the traditional buying league,” he said.

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