Asia's LNG Appetite: Chevron's Share of Gorgon Gas Going Fast
Chevron continues to lock up long-term sales agreements for its share of liquefied natural gas from the massive Gorgon project in Western Australia. The supermajor signed another agreement Wednesday to supply Japan's Chubu Electric with 1.44 million metric tons per year of LNG for 25 years. Chubu intends to buy 0.417 percent equity from Chevron's stake in the Gorgon project, according to the integrated oil company.
Take all of Chevron's other recently signed long-term export deals and less than a sixth of its share of gas remains to be sold.
The sales agreement with Chubu follows three others deals with Osaka Gas, Tokyo Gas and GS Caltex for a delivery of nearly 3 million metric tons per year. Chevron owns 50 percent of GS Caltrex. That deal was estimated to be worth $60 billion, Australian Prime Minister Kevin Rudd said after the September announcement. Chevron also has an agreement with the Korea Gas Corp., for 1.5 mtpy for 15 years.
The Chevron-operated Gorgon is expected to have a capacity of 15 million tons per year and a carbon dioxide injection project. Chevron will have a 47 percent share in the project after the sale with Chubu closes.
Chevron's other partners, Exxon and Royal Dutch Shell, both of which hold 25 percent, also have signed long-term LNG contracts in recent months. Exxon signed an agreement to supply PetroChina with 2.25 million tons per year of LNG and another deal with India's Petronet for 1.5 mtpa. Shell reached an agreement in 2007 to sell PetroChina 1 mtpa for 20 years.
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