Husky Energy and CNOOC Ltd. negotiating price adjustment for Liwan Gas Project
The offshore Liwan Central Platform. Photo courtesy of Husky Energy.
Husky Energy's China subsidiary has signed a heads of agreement (HOA) with CNOOC Ltd. and relevant companies for the price adjustment of natural gas from the Liwan 3-1 and Liuhua 34-2 fields that would see the price set at (approximately) $9.50-11.50/Mcf at current exchange rates.
Gross take-or-pay volumes from the fields remain unchanged in the range of 300-330 MMcfd. Liquids production, net to Husky, is also expected to remain in the range of 5,000-6,000 bpd. The price adjustment under the HOA is effective as of November 20, 2015 and the settlement of outstanding payments is calculated from that date.
"Husky and CNOOC plan to further deepen their cooperation and have undertaken to jointly create more value with the advancement of the Liuhua 29-1 gas field," said Ghosh.
Plans will get underway to finalize the commercial and development approach to tie the Liuhua 29-1 field into the Liwan infrastructure. Liuhua 29-1 gross gas sales volumes are expected to add approximately 80 MMcfd.
Husky holds a 49% interest in the production sharing contract (PSC) for the Liwan Gas Project and operates the deepwater infrastructure. CNOOC Limited holds a 51% interest in the PSC and operates the shallow water facilities and the onshore gas terminal.
Husky and CNOOC continue to advance a rich portfolio of opportunities in the Asia Pacific Region, including several shallow water natural gas and liquids developments offshore Indonesia.
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