Korea Gas Corp., the world's biggest buyer of liquefied natural gas, said it's in talks to acquire a 15 percent stake in the Santos Ltd.-led Gladstone LNG venture in Australia to supply Asia's fourth-largest economy.
The state-run utility is also in talks to buy 9.8 percent of Indonesia's Senoro project run by Mitsubishi Corp. and for 15 percent of its LNG processing plant, the company said in a prepared report to South Korean lawmakers today.
Korea Gas didn't say how much the Gladstone LNG stake may cost. Yonhap News reported Aug. 27 that the company was near agreement on buying a 10 percent stake in the project for $1.5 billion, citing a company official it didn't identify.
The Seongnam-based company is seeking stable supplies of the cleaner-burning fuel and said in May it plans to spend 17.8 trillion won ($15.8 billion) by 2017 on overseas expansions. Matthew Doman, a spokesman for Adelaide-based Santos, didn't immediately return a phone call today seeking comment on the discussions.
Separately, Korea Gas said it expects the nation's gas demand between October and March to increase by 11 percent from a year earlier as economic recovery boosts consumption. The state-run utility projects demand of 20.4 million metric tons for the period, according to the report to lawmakers.
Korea Gas plans to focus on short-term contracts to secure the fuel until 2014 because it expects oversupply in the global LNG market to continue for the next four years, according to the report.
source: APEC-VC Korea
