Toyota Tsusho Corporation (TTC) has concluded an agreement with AWE Limited to acquire the following two equity interests.
1. An 11.25% equity interest in the “BassGas Project”
2. An 2.75% interest in the nearby exploration permit T/18P
TTC’s wholly owned subsidiary, Toyota Tsusho Gas E&P Trefoil Pty Ltd. will acquire from AWE for a combined purchase price of AU$80.125Mil. Over the short-term, TTC expects to contribute an over AU$40Mil of equity to cover its share of future costs to further develop the assets. Accordingly, the total amount invested by TTC is expected to be over AU$120Mil.
The BassGas Project and T/18P permit are operated by Origin Energy Ltd., a major integrated energy company in Australia.
The BassGas Project consists of an offshore production platform connected to the Yolla gas field (permit T/L1), located in the Bass Strait, and an associated onshore gas processing plant located at Lang Lang, Victoria connected by a 150km subsea pipeline. Gas, condensate and liquefied petroleum gas (LPG), produced by the BassGas Project, have been sold primarily into the State of Victoria since 2006. A little under five percent of the demand for gas in South Eastern Australia has been supplied by the project, and it has become a vital supply source.
The T/18P permit is an offshore permit located in the Bass Strait and where gas, condensate and oil have already been confirmed to exist. Development intended for supplying gas to South Eastern Australia, similar to BassGas Project, is anticipated in the future for this permit. The acquisition will increase TTC’s existing ownership in T/18P from 8.5% to 11.25%.
TTC considers Australia to be one of the most important countries for upstream investments in the gas value chain. The company has been acquiring conventional and unconventional gas exploration and development rights for the purpose of building an LNG value chain that caters to Japan. The AU$ 98.5 Mil acquisition of the coal bed methane permit, ATP651P (in Queensland) in March 2010 was consistent with this strategy.
This acquisition will be TTC’s second investment in a gas production project for the domestic market in Australia following the acquisition of a 5% interest in the Otway Gas Project in October 2010. In addition to making further investments towards the gas related projects for the Australian domestic market, where steady growth in gas demand is expected in the future, the strategy of the company calls for proactive investments in the building of an LNG value chain.
[mappress] LNG World News Staff, December 8, 2011; Image: AWE