BHP signs off on LNG stake
The finalisation of BHP Billiton's $US1.63 billion ($1.71 billion) sale of its stake in Woodside Petroleum's Browse liquefied natural gas venture in Western Australia to PetroChina has dispelled uncertainty that the deal could have been abandoned after cost blowouts on the project.
The sale of BHP's stake to the Chinese petroleum giant was first mooted in December but doubts over the transaction emerged after the project's operator, Woodside, abandoned its original development plans in April amid soaring costs.
In a statement to the stock exchange on Friday, BHP said all required approvals had been secured and relevant documents were signed in Beijing to finalise the transaction.
"This sale reflects BHP Billiton's exit from the Browse joint ventures," it said.
In what can be seen as a vote of confidence in Woodside's new push for the project to be developed using cheaper floating technology, developed with joint venture partner Royal Dutch Shell, BHP and PetroChina signed off on terms originally agreed to in December.
It sees BHP's 8.33 per cent stake in the East Browse Joint Venture, and the 20 per cent interest in the West Browse Joint Venture change hands.
Woodside said in April it would not go ahead with the original plan to build a $45 billion-plus LNG project at James Price Point on the Kimberley coast.
Woodside has since moved a step closer to adopting an offshore option using two huge floating LNG ships, after entering an agreement with venture partner Shell to study the technology last month.
WA Premier Colin Barnett, speaking in Japan as part of a week-long trade mission, said WA remained on course to be a major energy supplier to the country, despite the delays to Browse and fears of mounting competition from the US and East Africa.
Despite the US shale gas revolution, the Premier said the Japanese appeared to have recognised that, while it could secure some gas exports from the Americans, most would be kept for domestic use.
Mr Barnett said Japan was going through "an agonising process" about its future energy sources after the Fukushima nuclear power plant disaster.
"Japan will also have to dramatically increase its gas imports to fill that gap over the next 10 years or so," he said.