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Apache to Exit Australian Energy With $2.1 Billion Sale

Apache Corp. will exit Australia’s energy sector, selling its assets there to a group of private equity funds managed by Macquarie Capital Group Ltd. and Brookfield Asset Management Inc. for $2.1 billion in cash. The assets produced the equivalent of about 49,000 barrels of oil a day in March. The company is keeping a 49 percent stake in fertilizer producer Yara Pilbara Holdings Pty. “Following the sale of our Australian assets, approximately 70% of Apache’s production will come from North America onshore,” John J. Christmann, chief executive officer of Apache, said in a statement Wednesday. Link to Statement:Link

Posted On : Published By : Tom Whipple
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Buying BG Gives Shell Solution to Stranded Australian Gas Assets

Royal Dutch Shell Plc is seeking an outlet for its natural gas reserves in Australia’s Queensland state. Its $70 billion purchase of BG Group Plc provides a solution. Shell and its partner PetroChina Co. have been looking at alternatives for their Arrow gas project after shelving plans to build an export terminal this year due to cost blowouts and slumping energy prices. Arrow is in the same state as plants run by Santos Ltd. and ConocoPhillips — as well as BG’s $20 billion Queensland Curtis LNG development. “The Arrow assets are stranded at the moment, so it’s highly probable that if Shell’s purchase of BG went through, that gas would be monetized through QCLNG,” Neil Beveridge, an analyst at Sanford C. Bernstein in Hong Kong, said Wednesday before the agreement was announced. “That’s definitely a source of value for this deal.” The combined company will have double the market […]

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Chevron’s Exit Signals Delays in Unlocking Australia’s Shale

(Bloomberg) — Chevron Corp.’s decision to pull out of a natural gas project in Australia after a plunge in oil prices is a signal it’s going to take even longer for the nation to realize its shale ambitions. Tapping Australia’s shale oil and gas was already challenging due to high drilling costs and the remote locations of its fields, with significant production forecast to be at least several years away. An almost 50 percent drop in the price of crude over the past year makes it harder. “The pace will be considerably slower than anyone would have forecast 18 months to two years ago,” Geoffrey Cann, Australian director of oil and gas for Deloitte LLP in Brisbane, said in a phone interview. The languishing oil prices are stalling efforts to replicate the U.S. shale boom globally. Big producers ConocoPhillips, Hess Corp. and Statoil ASA have already beaten Chevron out […]

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Chevron to divest 50% stake in Caltex Australia

Chevron’s executive vice-president of Downstream and Chemicals Michael Wirth said in a statement that the divestment is aligned with its previously announced asset sales commitment and is part of its desire to regularly review its portfolio and generate cash to support long term priorities. "Chevron will continue to ensure a reliable, high-quality supply of product is available to Caltex to supply to its retail and reseller franchise network. Chevron is also committed to seeking long-term relationship opportunities with Caltex." Caltex has a 109,000 b/d refinery at Lytton in Brisbane, which operated at 88.6% utilization last year. The company shut its 135,000 b/d refinery at Kurnell in Sydney in October 2014. The facility is currently being converted into an import terminal. The fall in crude prices resulted in a dramatic drop in Caltex’s profit to just A$20 million ($15.7 million) last year, down from A$530 million in 2013. Meanwhile, Chevron […]

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Woodside to Pay $2.75 Billion for Apache Project Stakes

Australia’s Woodside Petroleum Ltd. (WPL) agreed to pay Apache Corp. (APA) $2.75 billion for stakes in two liquefied natural gas projects, while delaying approval for its own $35 billion-development off the nation’s northwest coast. The Apache transaction will give Woodside interests in the Wheatstone LNG and Balnaves oil projects in Australia as well as Canada ’s Kitimat LNG development. The projects are among dozens under construction or consideration worldwide as companies seek to feed Asian markets hungry for gas. Woodside has been seeking acquisitions after its $2.7 billion plan to buy back shares from Royal Dutch Shell Plc was blocked by investors. Apache, facing pressure from activist hedge fund Jana Partners LLC to cut spending and focus on the U.S., said in July it was seeking to exit the proposed Canadian project and the facility under construction in Australia. The Apache deal “adds production growth in a period when […]

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Apache dumps Australian, Canadian LNG assets

U.S. energy company sells stakes in two LNG projects to Australian energy company Woodside Petroleum for more than $2 billion. UPI/Stephen Shaver "I am proud of Apache’s legacy in advancing the Wheatstone and Kitimat liquefied natural gas projects, and I am confident that Woodside’s participation will have a positive impact in seeing these world-class LNG facilities through to first production," G. Steven Farris, the top executive at Apache, said in a statement. Apache sold its interests, which include oil and natural gas reserves, to Australian energy company Woodside Petroleum. Apache under the terms of the deal is also reimbursed around $1 billion for net expenses on the two LNG projects. The first phase of the Wheatstone project envisions deliveries of up to 8.9 million tons of LNG per year from third-party gas projects in Australia. The proposed Kitimat project in British Columbia has a planned capacity of 5 million […]

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Floating LNG Plants May Be Solution for Australia

2:39 am ET Asia Royal Dutch Shell’s Prelude floating liquefied natural gas plant in the shipyard of Samsung Heavy Industry in Geoje, South Korea. It was designed to take in the equivalent of 110,000 barrels of oil per day in natural gas and cool it into LNG for transport and sale in Asia. Associated Press Australia is expected to become the world’s largest supplier of liquefied natural gas by the end of the decade, but significant cost overruns and delays in building new LNG projects are threatening its future competitiveness as companies move forward with major projects in the U.S. and Canada. The solution for Australia may be floating LNG plants, because they can be built overseas, where the costs of labor and materials are generally lower, Australian Industry Minister Ian Macfarlane said. “If any new LNG project comes to pass [from scratch], it’d be FLNG,” Mr. Macfarlane said […]

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China Trade Pact Set to Deliver Relief for Australian Coal Mines

Print Back to story A free trade agreement with China, the world’s biggest coal consumer, is set to bring some relief to struggling producers in Australia . China is expected to exempt the miners from import tariffs as part of the new trade accord, according to HSBC Holdings Plc. Chinese President Xi Jinping is scheduled to address Australia’s parliament in Canberra today when the agreement is scheduled to be announced. The removal of the tariffs, designed to protect struggling Chinese mines, will help bolster margins of producers in Australia, the biggest coal exporting nation. A global glut and slowing demand growth have depressed prices, forcing companies from BHP Billiton Ltd. (BHP) to Glencore Plc to cut costs. “For the coal space, there’s a good chance it will mean that the tariffs recently announced by the Chinese won’t apply to Australian exports of thermal coal,” Paul Bloxham, chief Australia economist […]

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Australia, China deepen ties with landmark free trade deal

CANBERRA (Reuters) – China and Australia on Monday sealed a landmark free trade agreement more than a decade in the making, significantly expanding ties between the world’s second largest economy and one of Washington’s closest allies in Asia. The deal, which Australia called the best ever between Beijing and a Western country, will open up Chinese markets to Australian farm exporters and the services sector while easing curbs on Chinese investment in resource-rich Australia. Australian Prime Minister Tony Abbott and Chinese President Xi Jinping signed a memorandum of understanding clinching the agreement during a ceremony in parliament in Canberra. "This has been a 10-year journey, but we have finally made it," Abbott said. Xi praised the deal in an address to parliament, pledging to deepen cooperation with Australia while reaffirming China’s willingness to resolve territorial disputes with its neighbors through diplomatic means. "As long as we have our long-term […]

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Coal versus climate in Australia

Prime Minister Tony Abbott has described the science on climate change as ‘crap’ [Getty Images] Australia continues to frustrate efforts by fellow G20 members to include climate change on the agenda at the upcoming leaders’ summit in the eastern city of Brisbane this weekend. As the host nation sets the G20 meeting’s agenda , Australian Prime Minister Tony Abbott – an avowed sceptic of human-caused climate change – has resisted calls for global warming to be discussed when world leaders gather on November 15 and 16. Despite a recent official draft summary of proceedings appearing to make token references to climate change, the level of importance afforded to the issue remains unclear. Climate change was on the agenda at the previous eight G20 summits. Since forming the government in September 2013, Abbott has repealed Australia’s nascent emissions trading scheme and slashed funding to agencies and programmes promoting renewable energy and […]

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