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Australia Wins China LNG Contract

Australia’s Northwest Shelf Venture is to be the sole supplier of liquefied natural gas to Guandong province in China.

The announcement was made today by Prime Minister John Howard.

Text of statement released by Prime Minister John Howard.

I am delighted to announce that today I have been advised by the Chinese Premier Zhu Rongji that Australia’s Northwest Shelf Venture has been chosen by China to be the sole supplier of liquefied natural gas (LNG) to its first LNG project in Guangdong province.

The contract will be worth between $20 – $25 billion in export income for Australia. This is Australia’s largest single export deal.

Starting from 2005-06 the venture will supply over 3 million tonnes of LNG per year for 25 years. It is likely to entail an eventual additional investment in a fifth LNG processing train for the Northwest Shelf facilities on the Burrup peninsula, which in itself would be worth about $1.5 billion.

I warmly congratulate the venture on winning this contract. It has been a pleasure to work so closely with the Chief Executives of the consortium to achieve this excellent result.

It is a major and exciting development in the growing trade and economic relationship shared by Australia and China. It represents a new energy partnership between our two nations.

This outcome follows several years of tireless work by many parties. A great Australian team effort has been involved.

I pay tribute to the companies and to the Australian Ambassador in Beijing Mr David Irvine who has been ceaseless in his efforts on behalf of the joint venture. Many of my ministerial colleagues have also been heavily involved.

The joint venture’s bid for the LNG contract was a major focus of my own visit to Beijing in May. I especially appreciated the manner in which my strong support for and representations on behalf of the joint venture were received by the Chinese leadership.

The awarding of this contract to Australia is a fitting way to mark the 30th year of diplomatic relations between our two countries. It speaks well of the trust and respect which exists between us as well as the maturity of the relationship.

Note: The participants in the Venture are Woodside Energy Ltd (operator), BHP Billiton Petroleum (North West Shelf) Pty Ltd, BP Developments Australia Pty Ltd, Chevron Texaco Australia Pty Ltd, Japan Australia LNG (MIMI) Pty Ltd and Shell Development (Australia) Proprietary Ltd – and the Venture’s marketing arm, Australia LNG (ALNG).

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