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ConocoPhillips jumps on $2 billion APLNG stake


ConocoPhillips will use its pre-emptive rights to snap up an extra 10 per cent of the APLNG project in Gladstone for $2.1 billion.

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Origin’s sale was announced in October but at the time it was a deal with private equity company EIG. However, ConocoPhillips had the right as a joint venture partner to exercise its rights.

The decision comes as LNG prices have hit a purple patch with spot shipments from Gladstone selling recently for speculated $180 million.

The other shareholder in APLNG, Sinopec, has until December 17 to exercise its respective pro-rata pre-emption rights. The deal must also get approval from the Foreign Investment Review Board.

Origin and ConocoPhillips will retain their existing seats on the Australia Pacific LNG board and Origin said the sale would not change its role as upstream operator, responsible for the upstream exploration, development, and production activities. Origin will retain a 27.5 per cent stake in the project.

If ConocoPhillips and/or Sinopec successfully exercise their pre-emptive rights and the transaction with EIG does not proceed, the Origin guarantee to satisfy any cash calls made by Australia Pacific LNG in respect of the 10 per cent shareholding will cease to apply.

Origin chief executive Frank Calabria said APLNG was a world-class LNG asset and the value realised from this transaction was due to the hard work and dedication of the joint venture and its shareholders over many years.

“We look forward to continuing to work with our partners to ensure Australia Pacific LNG maintains its strong performance and can continue to meet the needs of our LNG customers in Asia and to domestic customers as the largest supplier of gas on Australia’s east coast,” he said.


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