CNOOC ups ownership to 50% of CSG-LNG Queensland project

China National Offshore Oil Corp. (CNOOC) will move to a 50% interest in Train 1 of the Queensland Curtis Island coal seam gas-LNG project, operated by BG Group.

BG sold a further 40% of the project to the Chinese company for $1.93 billion to add to its existing 10% interest.

Under a separate agreement, BG is to supply CNOOC with another 5 million tonnes/year of LNG for 20 years beginning in 2015. This LNG will come from BG’s global portfolio of assets.

The Queensland Curtis LNG deal includes CNOOC receiving a 20% interest in reserves and resources of some BG permits in the Walloon Fairway region of the Surat basin taking its share there to 25%. In addition CNOOC gets a 25% equity in other BG permits in the Bowen and Surat basins.

CNOOC will have the option to participate in up to 25% in one of the possible expansion LNG Trains at QCLNG on Curtis Island.

BG and CNOOC will jointly invest in construction of two LNG carriers in China, taking the number of committed vessels to four.

However the agreements exclude CNOOC gaining any interest in Train 2 facilities, the transmission pipeline, and the project’s common facilities.