Gulf Oil and Gas accountACCOUNT

Petronas Weighs Sale to Exit $27B Canada LNG Project

Source: Reuters 9/30/2016, Location: Asia

Malaysian state oil firm Petroliam Nasional Bhd is considering selling its majority stake in a $27 billion Canadian liquefied natural gas (LNG) plant, three people familiar with the matter said this week.

Petroliam Nasional, or Petronas, is weighing options for the project as its finances have been squeezed after crude oil prices have collapsed by more than 50 percent since the middle of 2014. Additionally, the economics of the project have been called into question as LNG prices for delivery into the main markets in northeast Asia have slumped more than 70 percent over nearly the same time period.

Petronas was given the go-ahead for the project by the Canadian government earlier this week. It said then that executives would study the conditions imposed by the Canadian authorities and conduct a review before deciding on the next steps.

Petronas on Friday said it will not provide any additional comment when asked about the potential sale.

The sources said Petronas has been considering a sale for months, after it became apparent that a Canadian approval was possible, but had yet to take a final decision. Other options are also being considered, including putting it on ice.

They added that finding a buyer in current market conditions would be difficult. Petronas signed on for the project in 2012 through the acquisition of Canada's Progress Energy. That year LNG prices climbed to as high as $18.17 per million British thermal units (mmBtu) but have fallen to $5.75 per mmBtu since then.

If suspended, the project would be put on ice until gas prices begin to turn around and Petronas is confident of securing long-term contracts at reasonable prices, said the sources, who declined to be identified as the negotiations are not public.

Petronas has minority partners for the project in China, India, Japan and Brunei.

Acquisitions and Divestitures News in Malaysia >>

Cameroon >>  3/30/2020 - Tower Resources plc, the AIM-listed oil and gas company with its focus on Africa, is pleased to announce updates in respect of its Thali Production Sh...
Canada >>  3/30/2020 - As announced on 18 December 2019, the acquisition of the Wizard Lake assets would proceed in stages. Stage 1 was completed on 23 December 2019 with SB...

United States >>  3/30/2020 - Given current market conditions, Shell announces it will not proceed with an equity interest in the proposed Lake Charles LNG project. Accordingly, En...
Australia >>  3/26/2020 - 3D Oil has announced that ConocoPhillips Australia and TDO’s wholly owned subsidiary, 3D Oil T49P have executed a Joint Operating Agreement ('JOA') in...

Australia >>  3/26/2020 - Real Energy, an Australian east coast focused gas company with interests in the Cooper and Surat Basins has announced that the Queensland Government h...
Georgia >>  3/26/2020 - Block Energy Plc has entered into a sale and purchase agreement ("SPA") with Schlumberger B.V. to acquire its subsidiary Schlumberger Rustaveli Compan...

Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


Malaysia Oil & Gas 1 >>  2 | 3 | 4 | 5 |

More News

Related Links

Gulf Oil and Gas
Copyright © 2020 Universal Solutions All rights reserved. - Terms of Service - Privacy Policy.