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Apache said to seek buyer for holdings in Wheatstone LNG project

BRETT FOLEY and JAMES PATON

HOUSTON (Bloomberg) -- Apache Corp., the energy company that has announced $9.8 billion of asset sales in the past year, is seeking a buyer for its interests in the Wheatstone LNG project, people familiar with the matter said.

The oil and gas producer is in early discussions with potential buyers for its holdings in the A$29 billion ($27 billion) project in Western Australia, said the people, who asked not to be identified as the matter is private. Macquarie Group Ltd. and Goldman Sachs Group Inc. are advising Houston-based Apache on the sale, they said.

Apache is selling assets and cutting capital spending as it seeks to reduce net debt, which stood at $8 billion at the end of March, according to data compiled by Bloomberg. In the past year it has announced divestitures of its Argentinian operations, deepwater assets in the Gulf of Mexico and a stake in its Egypt business.

The company owns a 13% stake in the Wheatstone plant, which will produce 8.9 million tons of LNG a year and is due to start in 2016, according to its website. It also holds a 65% interest in the Julimar and Brunello offshore fields, which it operates and which will provide gas to the Wheatstone facility.

Chevron Corp. owns 64% of the Wheatstone project, according to its Australian unit’s website. Kuwait Foreign Petroleum Exploration Co., known as Kufpec, holds 13% while a group of Japanese companies including Tokyo Electric Power Co., known as Tepco, jointly hold an 8% interest.

Royal Dutch Shell Plc agreed in January to sell its 6.4% stake in the Wheatstone project and an 8% stake in the Wheatstone-Iago gas fields for $1.14 billion to Kufpec.

The Wheatstone facility will supply fuel to customers in Asia such as Tepco, Chubu Electric Power Co. and Tohoku Electric Power Co.

David Parker, a Perth-based spokesman for Apache, referred to comments CEO Steven Farris made in a May 28 presentation. Farris said at the time Apache was “trying to monetize” Wheatstone, according to a transcript. Parker declined to comment further.

Spokeswomen for Macquarie and Goldman Sachs declined to comment.

07/06/2014

 

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