PetroChina lines up Browse LNG deal

PetroChina is expected to sign a head of agreement with Australia's Woodside Petroleum in Perth tomorrow which would see China import 2 million tonnes per annum of liquefied natural gas from the Browse gas project.

The price of the deal is not clear, but sources said the price is based on the market value of the fuel.

The move follows a similar deal the company signed with Shell in Perth today that will see the Chinese giant take 1 million tpa of LNG for 20 years from the Gorgon development.

Shell's deal is understood to have a price structure of $10 per million British thermal units.

The Browse LNG will be shipped to a terminal owned and operated by PetroChina in eastern China's Jiangsu province.

People familiar with the deal said China's top LNG developer China National Offshore Oil Corporation (CNOOC) is also expected to sign a deal with Chevron, perhaps later in the week, covering 3 million tonnes of LNG from Gorgon.

CNOOC will send the Gorgon LNG to a terminal in Zhejiang province, in eastern China. CNOOC is already importing 3.7 million tpa of LNG from Woodside's Northwest Shelf project.

The new deals coincide with Chinese President Hu Jintao's visit to Australia this week for the Asia-Pacific Economic Co-operation forum summit in Sydney.