Korea Gas May Invest $1.5 Billion in Australian LNG Project, Yonhap Says

Korea Gas Corp. is near agreement on buying a 10 percent stake in Australia’s Gladstone liquefied natural gas project for $1.5 billion from Santos Ltd., Yonhap News said, citing a company official it didn’t identify.

The transaction may be completed in September and would give Korea Gas more than 2 million metric tons of LNG a year, the Korean-language news agency reported today. Lee Kwa Hyung, a company spokesman based in Seongnam, South Korea, and Matthew Doman, a Santos spokesman in Adelaide, declined to comment.

Korea Gas, the world’s biggest LNG importer, has said it’s in talks to buy stakes in Royal Dutch Shell Plc’s Prelude project and Santos’s Gladstone LNG in Australia to obtain stable supplies of the cleaner-burning fuel. The state-run utility said in May it plans to spend 17.8 trillion won ($15.5 billion) by 2017 on overseas expansion to bolster supplies of the fuel.

Santos, the Australian energy company planning the $15 billion project in Queensland, said yesterday it aims to sell at least 15 percent of the venture before committing to the first phase later this year. Choo Kang Soo, Gas Chief Executive Officer of Korea Gas, said Aug. 24 the company will complete talks with Santos by the end of September.

“We need to discuss the size of the stake and the price,” Choo said then.

To contact the reporter on this story: Shinhye Kang in Seoul at skang24@bloomberg.net

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