NWS signs LNG sales deal with S. Korea

NWS signs LNG sales deal with S. Korea

Agence France-Presse, Sydney

Australia's North West Shelf (NWS) announced Tuesday it had signed a contract to supply 220,000 tons of liquefied natural gas (LNG) to South Korea and said the deal could herald long-term sales to the Asian country.

The NWS marketing arm, Australia LNG, said it had finalized sale and purchase agreements on behalf of the six NWS shareholders to supply 220,000 tons of LNG to Korea Gas Corp. (Kogas).

The sale covers one spot cargo plus three cargoes that will be redirected from existing contracted customers where they are surplus to requirements, it said in a statement.

NWS said the sale represents the seventh spot cargo it has delivered to Kogas since 1989.

Australia LNG president Arthur Dixon said the new sale was a major step in building the relationship with South Korea -- the world's second largest importer of LNG after Japan.

"This is a significant step in developing our relationship with Kogas and we hope this will foster further long term LNG business with Korea," he said.

A spokesman for NWS partner Woodside Petroleum, Tony Johnson, said the group's priority was existing Japanese customers, but it would always look to sell excess capacity into the market.

"We have always viewed Korea as a very significant market in the region, they have a major LNG industry there already," he said.

"We do have a relationship with Kogas and would be keen to extend that relationship."

NWS recently won a contract worth A$25 billion (US$14 billion) to supply three million tons of LNG per year to China for 25 years starting from 2005-2006 -- the biggest single export deal in Australian history.

The five other shareholders in the NWS are BHP Billiton, BP Developments Australia, Chevron Oil Trading, Japan Australia LNG and Shell Development (Australia).