MidOcean, backed by EIG and Aramco, buys into Petronas stake in LNG Canada
- MidOcean buys 20% of Petronas venture holding 25% of LNG Canada
- MidOcean CEO says company in the market for further deals
- Saudi Aramco keen to expand LNG business
Liquefied natural gas company MidOcean, backed by EIG and Saudi Aramco, has agreed to buy a fifth of the Petronas venture that holds a 25% stake in Shell-led LNG Canada, MidOcean said on Tuesday.
The deal also includes a fifth of Malaysian state energy group Petronas's Canadian upstream assets in the Montney shale gas region that feeds into LNG Canada. MidOcean declined to comment on the price of the transaction, but a person familiar with the situation put it at a little more than $3 B.
LNG Canada shipped its first cargo in June, opening the first direct route for LNG from North America's Pacific coast to a huge market of buyers in Asia.
LNG Canada has a supply cost advantage because prices for Canadian natural gas consistently trade at a discount to the U.S. Henry Hub benchmark and in the past week have dropped into record-low negative territory.
Once at full capacity, LNG Canada is set to export 14 metric MMtpy. The owners are working on plans to double the project's capacity.
Shell owns 40% of LNG Canada, PetroChina owns 15%, Mitsubishi owns 15% and Korean Gas Corporation owns 5%. LNG Canada cost about C$40 B ($29 B) to construct, the Canadian government has said.
MidOcean is private equity firm EIG's LNG investment vehicle, led by former Shell gas and LNG executive De la Rey Venter.
MidOcean, the capacity of which will be about 2.7 metric MMtpy of LNG once the deal closes, is looking to buy further price-advantaged LNG assets in the Asia-Pacific region, Venter said.
Saudi Aramco, which is seeking to strengthen its position in the LNG market, and Mitsubishi both bought into MidOcean in the past couple years. MidOcean owns stakes in LNG projects in Australia and Peru and is in talks to join the Lake Charles LNG project in the Gulf of Mexico, MidOcean's website says.
Petronas declined to comment on the price of the deal. A Petronas release on the transaction said it paves the way for potential future collaboration with MidOcean.
Related News
Related News
- ExxonMobil halts 1-Bft3d blue hydrogen project in Texas
- 236-mile Texas-to-Gulf pipeline reaches FID in $2.3-B LNG expansion push
- Bechtel shares findings of tragic accident at Port Arthur LNG facility
- Aramco and Yokogawa commission multiple autonomous control AI agents at Fadhili gas plant
- Ukraine will resume gas imports via Transbalkan route in November
Comments