Origin Energy expects Sinopec to fulfil LNG sales contract
JOHANNESBURG (miningweekly.com) – Australian energy firm Origin Energy expects Sinopec to fulfil its obligations to buy liquefied natural gas (LNG) from the Australia Pacific LNG joint venture (JV) project, the ASX-listed company said on Monday.
Origin responded to speculation that the Chinese buyer might not want all the gas it agreed to buy from the JV, in which Origin holds 37.5%, ConocoPhilips 37.5% and Sinopec 25%. The Chinese firm has a sales and purchase agreement (SPA) to buy 7.6-million tonnes a year from the project.
Origin confirmed that the SPA was structured as a take-or-pay agreement, which allowed Sinopec to decide where to take the LNG in order to manage the build up of key infrastructure and markets. “As the SPA is structured on a free-on-board basis, any exercise of this flexibility will not impact on Australian Pacific’s rights under the SPA,” Origin explained.
The SPA also provided Origin and ConocoPhillips, through Australia Pacific LNG, flexibility to determine the start date for supply of LNG to Sinopec. Origin said this was intended to occur after successful commissioning to ensure that the project could meet its obligations to supply cargoes under the supply agreement.
The LNG produced during the commissioning phase would be sold under short-term contracts. The company said Australia Pacific LNG had begun to contract these commissioning cargoes.
Origin also confirmed that the project remained on track for sustained production from train 1 in the second quarter of the 2016 financial year.
Comments
Research Reports
Projects
Latest Multimedia
Latest News
Showroom
Rentech provides renewable energy products and services to the local and selected African markets. Supplying inverters, lithium and lead-acid...
VISIT SHOWROOM
ESAB South Arica, the leading supplier of high-end welding and cutting products to the Southern African industrial market is based in...
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
