Chevron to sell Australian gas to Tokyo Electric

AP News
Posted: Dec 05, 2009 1:12 PM

Chevron Corp. on Saturday said it has signed a deal with Tokyo Electric Power Co. to deliver liquefied natural gas for up to 20 years from the Wheatstone Project in northwestern Australia.

Chevron also said TEPCO intends to acquire 15 percent of Chevron's share in the Wheatstone field licenses, and 11.25 percent of the Wheatstone natural gas processing facilities that will be built onshore near Onslow in northwestern Australia.

The agreement with Chevron Australia Pty Ltd. makes TEPCO a major customer for the natural gas from Wheatstone. It calls for TEPCO to buy 4.1 million tons per year of liquefied natural gas. The capacity of the Wheatstone project's initial phase will be 8.6 million tons per year, Chevron said.

Western Australia Premier Colin Barnett said the state continue to require that about 15 percent of gas processed on shore is reserved for domestic use. In a written statement, he said the state will benefit from "significant new export earnings" as well as from the additional domestic natural gas, which will equal about 20 percent of the state's current supply.

Chevron said in October that a subsidiary of Apache Corp. will assume 16.25 percent of the Wheatstone project, and a subsidiary of the Kuwait Foreign Petroleum Exploration Co. ksc will assume an 8.75 percent interest.