$70 Billion Broome-Beijing Gas Pipeline

Construction on $70 Billion Broome-Beijing Gas Pipeline Begins

Buru Energy, the woefully underrated Canning SuperBasin oil and gas company, has begun the world’s largest construction project: A $70 billion pipeline that will supply China with 38 billion cubic meters of gas per year.

Last night, Eric Streitberg of Buru signed a deal with China’s Natural Petroleum Corporation (CNPC) to build a 3,968 kilometer pipeline linking WA's gas fields to China. The 30-year contract has been valued at $400 billion.

“The new gas branch will significantly strengthen the economic cooperation with countries in the Asia-Pacific region and above all – our key partner Western Australia,” said Chinese President Hu Jintao at the pipeline’s inauguration ceremony outside the city of Broome, WA. In Kimberley tradition, Mr Steitberg and China’s Vice Premier Zhang Gaoli both threw a prawn on the barbie in nothing more than their thongs as a symbol of mutual admiration.

China currently consumes about 170 billion cubic meters of natural gas per year and expects that volume to rise to 420 billion cubic meters in less than a decade. The new pipeline, which will begin operations in 2019, will deliver 4 trillion cubic meters of gas to China over its lifetime.

Buru will be pumping gas from the Laurel field, which is estimated to produce 25 billion cubic meters of gas and 1.5 million tons of oil per year. Reuters reports that Buru Energy, the Australian company that owns the field, will enter into a “strategic relationship” with China.

China will spend $55 billion on pipeline construction outside its territory, in addition to spending $22 billion on its own. President Hu has stated that a separate pipeline for delivering gas to China’s western provinces is currently in its planning stages.

www.reuters.com/70billiondollarbroometobeijing1stofaprilgaspipeline/