BG borrows $1.8b from Ex-Im Bank for Curtis LNG project
BG GROUP has borrowed $1.8 billion from the US Export-Import Bank to fund US services and equipment used in the Queensland Curtis LNG project.
Australia's LNG projects have suffered cost inflation and BG in May announced that the budget for QCLNG, slated expected to produce its first gas in 2014, had blown out to $US20 billion.
BG agreed a $US3 billion syndicated loan facility in November, lifting its undrawn committed bank borrowings to $US5.2 billion.
BG shares in London finished the the year 29 per cent lower after a horror one-day fall at the end of October when the company warned there would be no growth in its oil and gas production this year.
In August, US environment groups served a notice that the Export-Import Bank had financed, or was about to finance, projects of Origin Energy's rival Australia Pacific LNG and QCLNG without complying with environmental review requirements. APLNG was lent $US3 billion by the bank in May.
The LNG facilities, near Gladstone, will be built on Curtis Island, which is within the Great Barrier Reef World Heritage Area.
In December the groups filed a lawsuit in a Californian court against Export-Import Bank over its loan to APLNG, arguing the construction and operation of the plant would threaten sea turtles, dugongs and other protected marine species, as well as the Great Barrier Reef itself.
"Dirty fossil fuel facilities don't belong in a world-famous marine sanctuary like the Great Barrier Reef," said Sarah Uhlemann, a lawyer at the Centre for Biological Diversity. "This liquefied natural gas project doesn't meet US standards."
A spokesman for BG said the US groups were campaigning against the use of fossil fuels and using the reef to generate publicity. QCLNG was being built in an industrialised port at the southern extremity of the reef and would have no impact on it, he said. LNG tankers would use approved shipping lanes and would avoid the inner reef route except in bad weather.
The spokesman said BG was diversifying its sources of funding to support its growth program and had similar loan arrangements in train with the Bank of China, the Brazilian Development Bank, Export Development Canada and Japan Bank for International Co-operation.