Mitsui has reached an agreement with Santos concerning the acquisition of Santos' 35% working interest in the Kipper gas and condensate field offshore Southern Australia. The sales and purchase agreement was signed on 6 November 2015 between Mitsui Exploration and Production Australia (MEPAU) and Santos Offshore.
The Kipper field is located in the Gippsland basin, approximately 45km off the coast of Victoria. Production of gas, condensate and liquid petroleum gas is expected to start in 2016, and the products are planned to be supplied to domestic market.
Gas demand for the Australian east coast is expected to grow substantially due to the start-up of three liquefied natural gas projects in Queensland.
Mitsui said that it believes the Australian east coast will continuously require new investments in developing gas resources to meet such demand. The acquisition of domestic gas asset, which is less vulnerable to global oil price, will lead to a more robust energy asset portfolio against commodity price volatility, the company said.
The transaction will be completed after the satisfaction of customary conditions including obtaining Australian governmental approvals and existing joint venture partners' waiver of their pre-emption rights.
Image: Australia assets/Mitsui and Co.