PERTH (miningweekly.com) – Oil and gas miner Woodside would spend some $2.75-billion to acquire Apache Corporation’s share in the Wheatstone liquefied natural gas (LNG) project, the Balnaves oil interest, and the Kitimat LNG project in Canada.

CEO Peter Coleman told shareholders that the acquisition was a natural fit with Woodside’s current portfolio, and following a due diligence process, had met Woodside’s internal investment parameters.

“We have taken a disciplined and patient approach to identifying the right growth investment. We are now in a position to take advantage of challenging market conditions and use cash reserves and existing debt facilities to acquire very high quality assets,” Cole said.

Under the sales agreement, Woodside would acquire Apache’s 13% interest in the Wheatstone LNG project, and a 65% interest in the Julimar-Brunello upstream gas development.

Wheatstone is located 12 km west of Onslow and would consist of two LNG trains with a combined capacity of 8.9-million tonnes a year, along with a domestic gas plant.

Woodside was also acquiring Apache’s 65% interest in the Balnaves oil project, and its 50% interest in the Kitimat LNG project, which includes around 320 000 acres in the Horn River and Liard basins, and adds a growth option in an emerging LNG province to Woodside’s development portfolio.

The acquisitions would have an effective date of July 2014, and would be subject to regulatory approvals, pre-emption for both Balnaves and Kitimat, and joint venture participation consent for the Kitimat project.

Financial close of the acquisitions was being targeted for the first quarter of next year.

Meanwhile, Woodside on Tuesday also announced a revised schedule for the front-end engineering and design (FEED) work at its Browse joint venture, offshore Western Australia.

Coleman said that the substantial shift in market conditions had presented the company with an opportunity to seek significantly lower cost outcomes for the Browse development, drawing on lessons learned from other projects.

“The changes we are experiencing in our industry are starting to flow through our supply chain. We will use the time we have now to maximise long-term benefits for the development,” he said.

The company has already completed a basis of design, as well as key pre-FEED work for the proposed development, and was now progressing additional strategic activities, including further progressing primary approvals, managing the imapcts of the maritime boundary change affecting the Browse retention leases, and additional technical work to optimsie and de-risk the development.

Woodside was hoping that Browse could enter the FEED phase by mid-2015, and was targeting a final investment decision by mid-2016.

The Browse LNG project is jointly owned by Woodside, Shell, BP, Chevron and PetroChina, which acquired its stake in the project through a $1.63-billion deal with BHP.

The project includes three gasfields estimated to contain a combined contingent resource of about 13.3-trillion cubic feet of dry gas and 360-million barrels of concentrate. First gas production had initially been slated for 2017.

Meanwhile, Coleman on Tuesday noted that the company’s capital commitments on both sanctioned projects and sustaining capital were expected to be at the lower end of around $0.8-billion a year, over the next three years.