June 9, 2009 / 2:26 AM / 9 years ago

UPDATE 1-Chevron says secures clients for Gorgon LNG project

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By Jennifer Tan

KUALA LUMPUR, June 9 (Reuters) - Chevron Corp (CVX.N) said on Tuesday it had secured customers in Japan and South Korea for about 70 percent of liquefied natural gas (LNG) supply from its multi-billion dollar Gorgon project in Australia.

The U.S. oil major has a total of seven LNG projects in its portfolio in various stages of maturity. By 2015, LNG production is expected to more than triple to about 300,000 barrels of oil equivalent per day.

“Chevron has signed non-binding heads of agreements with three utility companies in Japan and GS Caltex in South Korea for Gorgon,” the company said.

Approximately 70 percent of Chevron’s LNG off-take is expected to be purchased through these agreements,” a company spokeswoman said in an emailed response to questions from Reuters.

Chevron won conditional approval in late April from the Environmental Protection Agency of Western Australia to increase the size of Gorgon to 15 million tonnes per annum (mtpa), after having received approval for a 10 mtpa project in 2007. [ID:nSYD355497]

    Last month, India’s Petronet LNG (PLNG.BO) inked an agreement with ExxonMobil (XOM.N) to buy 1.5 million tonnes a year of Gorgon LNG for its terminal in Kochi in southern India. [ID:nDEL309556]

    The formal sale pact would be signed this month with ExxonMobil’s subsidiaries, Australia Resources Co Pty Ltd and Mobil Exploration & Producing Australia Pty Ltd, and Petronet said there was potential for additional supplies for the 20-year deal.

    Chevron has a 50 percent stake in the project, while ExxonMobil and Royal Dutch Shell (RDSa.L) own 25 percent each. The three companies are marketing their share of gas separately. (Writing by Ramthan Hussain; Editing by Michael Urquhart)

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