By ROSS KELLY AND WAYNE MA
SYDNEY -- PetroChina confirmed that it withdrew a bid
for an Australian coal bed methane gas producer but said it
would continue to invest in other Australia projects because of
their commercial value and importance for energy security.
"We have completed a number of mergers and acquisitions in
Australia and will make further investments in those projects,"
the company said in an email. "These projects are of strong operational
and strategic significance and will supplement PetroChina's
reserves in the future, secure needs for sustainable overseas
development and bring economic returns for the company."
WestSide Corporation, which has coal bed methane gas
prospects in Queensland, said earlier that PetroChina withdrew
its $184.7 million offer for the company.
The decision comes as labor shortages and cost pressures
have squeezed energy projects in Australia.
PetroChina made the bid for WestSide in November but
withdrew almost six months later "because the general situation
in Australia has changed so much," WestSide said, without
WestSide, which produces natural
gas extracted from coal deposits, said it was still in
talks with other parties that could invest in the company
either through a gas sales agreement, joint venture or
PetroChina's decision comes about one month after
Australia's Woodside Petroleum and its partners, including
Shell, shelved plans for a LNG
terminal that was forecast to cost more $40 billion.
China has been on an international quest to secure multiple
sources of natural
gas to help it meet targets to more than double the cleaner
burning fuel's contribution to its energy mix to 10% by 2020
from less than 5% now.
WestSide's gas would have supported a small LNG project in
Queensland planned by PetroChina and a smaller Australian
partner, Liquefied Natural
Gas Ltd. That project was slated to produce up to 3 million
metric tons of LNG
PetroChina bought another small Queensland gas producer,
Molopo Energy, last year for $44.21 million, and is also is a
partner with Shell in a much larger joint venture project with Arrow Energy, also in
The Arrow partners are still considering whether to go ahead
and build a multibillion dollar LNG plant. They face mounting
cost pressures and the possibility that competing LNG
supplies to Asia could emerge from North America and East
Africa, making it harder to find customers.
Dow Jones Newswires