SINGAPORE, Sept 12 (Reuters) - Apache Corp and its partners in Canada’s Kitimat liquefied natural gas (LNG) export project are looking to sell about 20 percent of their stake to large investors, a company executive said Wednesday.
Kitimat LNG is widely considered to be the front runner among five proposed LNG export developments in Canada. Apache’s partners are Encana Corp and EOG Resources Inc.
“In total, we’ve probably got about 20 percent we can offer,” Doug Adams, vice president of Apache LNG told reporters on the sidelines of an industry gathering in Singapore, adding that the current partners would decrease their stakes proportionally in order to offer the 20 percent equity.
“There’s a lot of interest. A lot of buyers want equity, but we are offering equity to substantial off-takers or major foundation buyers, not to everyone,” Adams said.
Apache and its partners plan to make a final investment decision on the development in the first quarter of 2013 and it is expected to come online in 2017.
Most of the buyer interest for Kitimat LNG has come from North Asia, Adams said.
Long-term contracts offered to those buyers will have prices indexed to oil, he added. That may disappoint North Asian investors who have been drawn to North American projects in the hope that prices will not be oil-indexed, as many of their other long-term contracts in Asia are.
North American gas prices, especially in the United States, have plummeted in recent years due to a boom in shale gas, with U.S. natural gas prices under $3 per million British thermal units (mmBtu) compared with around $13 per mmBtu for spot LNG supplies in Asia.