The LOI to negotiate a sale and purchase agreement will lead to the first LNG term contract signed between the North West Shelf LNG Sellers and Kogas.
Initial LNG volumes will be delivered in late 2003, building to 0.5 million tonnes of LNG a year in 2004. The term of the contract is seven years and the LNG will be delivered on an ex-ship basis.
Australia LNG, the North West Shelf Venture's marketing services organization outside Japan, managed negotiations on behalf of the North West Shelf LNG Sellers. Arthur Dixon, President of Australia LNG said that the letter of intent represented a significant milestone in the development of the North West Shelf’s regional customer base.
"The letter of intent confirms the ongoing interest of customers in the region for Australian LNG," Mr. Dixon said.
"Considerable additional demand is expected in Korea in the future and Australia is well placed to further grow the supply of LNG to this important customer."
The six equal participants in the North West Shelf Venture are: Woodside Energy Ltd. (operator); BHP Billiton Petroleum (North West Shelf) Pty Ltd; BP Developments Australia Pty Ltd; ChevronTexaco Australia Pty Ltd; Japan Australia LNG (MIMI) Pty Ltd; and Shell Development (Australia) Proprietary Limited.
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