Aussie firms tie up in RI project

Aussie firms tie up in RI project

MELBOURNE (Reuter): Australian energy group Energy Equity Corp Ltd said it has formed a strategic alliance with Tenneco Gas Australia, a unit of U.S. gas group Tenneco Inc.

Energy Equity said that under the agreement Tenneco will purchase 50 percent of the Australian group's interest in the Sengkang production sharing contract and in the Sengkang power station project in Sulawesi, Indonesia for A$28 million.

Gas from the Sengkang contract will supply the 135 megawatt power station, which is to be built, owned and operated by Energy Equity and Tenneco.

Energy Equity said the purchase is conditional upon:

* The signing of the Sengkang gas sales agreement and power purchase agreement with the Indonesian government.

* The finalization of sale and purchase agreements between Tenneco and Energy Equity.

* Tenneco acquiring not less than 9.9 percent of the ordinary issued shares in Energy Equity.

* Tenneco having the exclusive right to take a 50 percent ownership interest in Energy Equity's gas and power project at Barcaldine in central Queensland.