Global law firm Herbert Smith Freehills and King & Wood Mallesons have advised on the China National Offshore Oil Corporation’s (CNOOC) $1.93 billion proposed acquisition of BG Group’s shares in the Queensland Curtis LNG (QCLNG) project. The deal also includes a further purchase of liquefied natural gas (LNG) from the latter.
Herbert Smith Freehills acted for CNOOC, while King & Wood Mallesons represented BG Group.
In the Heads of Agreement that marks China’s latest huge investments in Australia, CNOOC will increase its stake in the QCLNG to 50 percent by buying an additional 40 percent interest from BG Group in the first LNG production train.
CNOOC will also acquire further interests in the reserves and resources of certain BG Group tenements in the Surat Basin and Bowen Basin, bringing its interest in these fields to 25 percent. CNOOC will also have the option to participate as a quarter-partner in the first of any potential expansion trains at QCLNG.
In the meantime, BG Group will supply CNOOC with five million tonnes per annum of LNG for 20 years beginning 2015 from its global portfolio. This will make it the largest LNG supplier to China with a total committed sale of 8.6 million tonnes per annum.
Fully-termed transaction agreements are expected to be executed in the first half of 2013.
The Herbert Smith Freehills China team was led by Hong Kong-based partner Hilary Lau and Perth-based partner Stuart Barrymore.
“We are delighted to have had the opportunity to work with CNOOC again on this landmark LNG transaction which was a significant milestone for CNOOC in expanding its business in the LNG sector. We have a strong relationship with CNOOC and we look forward to building further on this as they continue with their international growth,” said Lau in statement.
“The expertise of our energy team was crucial in getting this deal done as it spanned the entire LNG value chain. The cooperation between our China and Australia teams provided tangible benefits to CNOOC with complex issues affecting multiple components of the transaction being digested and responded to in rapid time,” added Barrymore.
On the KWM side, partners Craig Rogers and Joshua Cole led the team for the deal.
“We are delighted to have worked on a deal that represents a significant milestone for BG Group, cementing it as the leading supplier of LNG to the world’s fastest growing energy market,” said Rogers.
Liu Zhen is China senior journalist at ALB. Follow us on Twiter: @ALB_Magazine.
Other related stories:
