China Liq Natural Gas Deal
BHP Billiton Limited
08 August 2002
BHP Billiton Limited is issuing this announcement to fulfil disclosure
obligations arising from its secondary listing on the London Stock Exchange.
The text of this release is identical to that issued by BHP Billiton Plc
earlier.
8 August 2002
Number: 49/02
BHP BILLITON ANNOUNCES CHINA LIQUEFIED NATURAL GAS DEAL
BHP Billiton has been advised through Australian diplomatic channels that the
North West Shelf Venture in Western Australia (NWS) has been selected as the
preferred liquefied natural gas (LNG) supplier to Phase 1 of the Guangdong LNG
Terminal and Trunkline Project ('Guangdong LNG Project').
Under the deal, the NWS Venture will supply three million tonnes per annum
(mtpa) of LNG over a 25 year period to satisfy the Phase 1 requirements of the
Guangdong LNG Project, China's first LNG import project. Subject to finalising
commercial arrangements, and approval by the Chinese Government of the Guandong
LNG Project Feasibility Study, supply will begin from the NWS Venture in 2005.
Following the execution of sales and purchase agreements with the NWS Sellers,
it is also proposed that:
• The China National Offshore Oil Company ('CNOOC') will have the
opportunity to acquire a participating interest in the NWS Venture gas
reserves and production that will supply gas to Guandong. A proposal has
been made that will allow CNOOC to become a full member of the joint venture
that will be created for LNG supply to China; and
• The NWS Venture and the Chinese shipping companies, COSCO and China
Merchants will establish ship owning and ship management companies for LNG
transport to Guandong. Two to three LNG ships will be required to services
the China trade route.
The Guangdong LNG Project involves the construction of an LNG import terminal
and high-pressure gas pipeline in two phases. Phase 1 of the Guangdong LNG
Project involves the construction of an LNG import terminal, a 300 km pipeline
along the eastern side of the Pearl River delta in Guangdong Province and a
branch pipeline to Hong Kong. In Phase 2, the pipeline will be extended around
the western side of the Pearl River delta. The estimated level of investment for
Phases 1 and 2 of the Project is US$850 million.
President and CEO BHP Billiton Petroleum Philip Aiken, the North West Shelf
Owners' Representative for the China LNG bid said that the outcome reinforces
Australia's position as a competitive, reliable and secure supplier of LNG to
the Asia Pacific region.
'We are delighted that the Chinese authorities have selected the NWS Venture to
supply LNG to Phase 1 of the Guangdong LNG Project,' Mr Aiken said.
'We see this as a further endorsement of the NWS Venture's reputation as a
world-class LNG exporter and we very much look forward to working with the
Chinese authorities in the years ahead.
BHP Billiton Chairman Don Argus and BHP Billiton CEO and Managing Director Brian
Gilbertson joined in expressing their appreciation of the important role played
by the Commonwealth Government, particularly the Prime Minister John Howard and
the Department of Foreign Affairs and Trade and the Western Australian
Government in securing this contract.
The NWS Venture is currently constructing a fourth LNG processing train at the
Venture's gas processing facilities on the Burrup Peninsula, Western Australia,
and a second trunkline from the North Rankin A Platform to shore. First LNG from
the fourth train is scheduled for mid-2004.
BHP Billiton is yet to be officially notified of the Chinese announcement
BHP Billiton's equity in the North West Shelf Project is 16.67 per cent.
****
Further news and information can be found on our Internet site:www.bhpbilliton.com
Australia United Kingdom
Andrew Nairn, Investor Relations Mark Lidiard, Investor & Media Relations
Tel: + 61 3 9609 3952 Mobile: +61 408 313 259 Tel: +44 20 7747 3956
email: Andrew.W.Nairn@bhpbilliton.com email: Mark.Lidiard@bhpbilliton.com
Mandy Frostick, Media Relations South Africa
Tel: +61 3 9609 4157 Mobile: +61 419 546 245 Michael Campbell, Investor & Media Relations
email: Mandy.J.Frostick@bhpbilliton.com Tel: +27 11 376 3360 Mobile: +27 82 458 2587
email: Michael.J.Campbell@bhpbilliton.com
United States
Francis McAllister, Investor Relations
Tel: +1 713 961 8625 Mobile: +1 713 480 3699
email: Francis.R.McAllister@bhpbilliton.com
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