Chevron Will Sell A Gazillion Tonnes Of LNG To China From Its Australian Source -- December 23, 2015

December 23, 2015: Rigzone/Reuters is reporting that Chevron agrees to sell Australian Gorgon LNG to Chinese firm.

 Chevron Corp on Tuesday said it has agreed to sell up to 1 million tonnes a year of liquefied natural gas (LNG) from its Australian Gorgon project to China Huadian Green Energy Co over 10 years starting in 2020.

The non-binding heads of agreement comes amid a deterioration in Asian LNG prices, aggravated by mounting supply from Australia, which aims to overtake Qatar as the world's top producer in coming years.

The price has slid two-thirds since 2014 to under $7 per mmBtu. "This is an important step in the commercialisation of Chevron's natural gas holdings in Australia," Pierre Breber, executive vice president of Chevron Gas and Midstream, said in a statement. 

Let's go back and look at the global reserves of natural gas as reported earlier at wiki: 

• Australia is #11 in global reserves at 152 trillion cubic feet (as of January, 2014).

Wow, there are a lot of story lines in that short, short article. 

Meanwhile in western Canada, Rigzone/Bloomberg is reporting:

As Canadian Oil Sands Ltd. tries to fend off Suncor Energy Inc.’s $3.2 billion bid, the latest upset at its only business couldn’t have come at a worse time.

After missing production targets each year since 2010, Chief Executive Officer Ryan Kubik is trying to convince investors that this time he’ll deliver on what’s been promised.

A December 8, 2015, production cut at the Syncrude oil-sands project only adds to the performance concerns.

“Performance is a big factor” for shareholders considering whether to sell to Suncor, said Michael Dunn, an analyst at FirstEnergy Capital Corp in Calgary. “This was supposed to be the year when things got better. Instead, they’ve got worse.”

The production cut at Syncrude highlights the challenges Kubik faces as he defends Canadian Oil Sands and its only asset against Suncor, whose market value is more than 12 times larger and which operates additional mines in Alberta, four refineries, almost 1,500 Petro-Canada service stations and oil wells in the North Sea. Extracting bitumen and converting it into crude is increasingly dominated by large, diversified companies like Suncor, Canadian Natural Resources Ltd. and Imperial Oil Ltd.

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