Apache, Chevron to Supply LNG to Shubu Electric
Oil companies Chevron , Apache Corporation , and their partners have finalized long-term agreements to supply Japan's Chubu Electric Power Company with liquefied natural gas extracted from their Wheatstone Project in Western Australia, the companies announced Thursday.
The agreements call upon the Wheatstone partners to supply 1 million metric tons of LNG annually over the next 20 years. This amounts to 11.2% of Wheatstone's projected 8.9 million ton annual production capacity.
If you break out revenues from this supply agreement, 64% should go to Chevron, 13% to Apache, and 6% to Royal Dutch Shell , with other partners accounting for the balance, based on their ownership interests in the project. Chevron will benefit most of all from the deal, inasmuch as it owns an 80% interest in the Wheatstone and Iago gas fields that supply 80% of the feedgas converted into LNG at the Wheatstone project.
Chevron shares are flat on the news, while Apache shares are up about 2.4%. Royal Dutch Shell is down 0.7%.
The article Apache, Chevron to Supply LNG to Shubu Electric originally appeared on Fool.com.
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