| LONDON, March 18
LONDON, March 18 China's biggest refiner Sinopec
is in talks with Malaysia's Petronas to buy a 15 percent stake
in a $20 billion Canadian liquefied natural gas (LNG) project,
three sources with knowledge of the matter said.
The Malaysian state oil company's Pacific Northwest LNG
project, due to start-up in late 2018, is one of about a dozen
proposed LNG export terminals for British Columbia's Pacific
Petronas has moved quickly to leapfrog rivals in
the race to export cheap Canadian gas to hungry Asian markets
after securing export permits and filing environmental
This month it struck a deal to sell Indian Oil Corp.
a 10 percent stake, alongside existing partners Japan
Petroleum Exploration and state-run PetroleumBRUNEI, in
a move designed to share the financial burden of developing the
Its deal with IOC also included a 10 percent stake in the
shale gas assets that will feed the LNG plant, but sources could
not confirm if Sinopec intended to follow suit.
While IOC secured around 1.2 million tonnes per annum (mtpa)
of the project's 12 mtpa export capacity, Sinopec can expect to
receive around 1.8 mtpa with a 15 percent stake, one of the
Chinese companies, like their Asian peers, have been
scouting for oil and gas assets abroad to meet rising domestic
China National Petroleum Corp. last year bought a
20 percent stake in the Novatek-led Yamal LNG project in
Russia's Arctic, while PetroChina hopes to develop
another Canadian LNG project called Kitimat.
It is also considering a $40 billion investment in western
Australia's Browse LNG project.
A separate industry source added that Sinopec is holding
discussions with multiple project developers and is undertaking
a comprehensive comparison to decide the best way forward.
Sinopec is also in talks to invest in the Kitimat project.
A Chinese delegation is expected in Canada this week to
discuss energy cooperation between the two countries, according
to a diplomatic source in Beijing.
(Additional reporting by Ron Bousso in London and Chen Aizhu in
Beijing, editing by William Hardy)