ExxonMobil Enters Into LNG Supply Agreement With Sinopec

Published: 04-Nov-2009

Esso Highlands Limited, a subsidiary of Exxon Mobil Corporation (ExxonMobil) and operator of the PNG LNG project, said that the project participants entered into a heads of agreement with Unipec Asia Co., Ltd., a subsidiary of China Petroleum & Chemical Corporation (Sinopec) for the long-term supply of two million tonnes per year of LNG.

The PNG LNG project participants are working with Sinopec to finalize a binding sale and purchase agreement. A final investment decision on the project is planned for later this year.

“We are pleased to have reached this important milestone with Sinopec,” said Ron Billings, vice president of ExxonMobil Gas and Power Marketing. “With this agreement in place, the PNG LNG project is now conducting exclusive discussions with major Asian LNG customers for binding sale and purchase agreements covering the full project capacity.”

“We are pleased to have signed this significant Heads of Agreement with the PNG LNG project, which is led by our partner ExxonMobil. This LNG resource will be supplied to a LNG receiving terminal that Sinopec will build in China,” said Wang Zhigang, senior vice president of Sinopec. "We hope that the working teams from both parties continue to work closely together to finalize the sale and purchase agreement as soon as possible."

The PNG LNG project is an integrated development which includes gas production and processing facilities, onshore and offshore pipelines and LNG plant facilities. Participating interests are ExxonMobil (Esso Highlands Limited as operator) 41.5%, Oil Search Limited 34%, Santos Limited 17.7%, Nippon Oil Corporation 5.4%, Minerals Resources Development Company 1.2%, and Eda Oil Limited 0.2%. Participation will change when PNG State nominees join as equity participants at a later date.