Doesn't actually mention MEO as such, but as I mentioned yesterday it is absolutely critical for Woodside to get Train 2 up and running as soon as they can after Train 1 of course. There are other reasons for that, as is mentioned in this article. The coming weeks are critical for Woodside in my opinion and they can't rely on their 20 well exploration program to confirm more gas in the region as we all know. They need gas and they need it NOW! No prizes for second in this market so expect to see MEO steadily climb in the coming weeks under speculation of this huge deal coming into place. DYOR. This is shaping up to be one of the biggest plays for Woodside to become the number 1 player in the LNG Market. Hope it goes well for fellow shareholders and all of a sudden the ball appears to be in MEO's court at the moment. LOL Cheers notthemama
Chevron's gas explosionOctober 23, 2009 By Jamie Freed
Chevron now has one up on its rival, Woodside Petroleum after last night dropping what will serve as a bombshell in the oil and gas industry.
Woodside will be left with few options for sourcing third-party gas for its planned second train at its Pluto liquefied natural gas project in Western Australia after Apache last night agreed to fold its Julimar field into a new joint venture with Chevron's Wheatstone project.
All three of those fields - Pluto, Julimar and Wheatstone - are in close proximity.
Chevron and Woodside have made it pretty clear that they each plan to build their projects individually, which left Apache and Hess as the swing players with gas in the region that could go to either of those developments.
Woodside has long been in negotiations with both Apache and Hess, but the decision by Apache to tie up with Chevron means that Woodside could be left with Hess - or the possibility of a big discovery of its own - as its only viable options to allow it to start construction on the second train as soon as the first train is completed.
If Woodside can't immediately start construction on the second train, it risks losing its staff to the Wheatstone development and Gorgon, and it could take a long time to recover from that sort of setback.
The tie-up between Chevron and Apache will leave Hess in a very strong bargaining position that could allow it to extract more concessions from Woodside than if Apache was also in negotiations with the Australian LNG player.
In return for vending Julimar into the Wheatstone joint venture, Apache and ots Kuwaiti joint venture partner KUFPEC will hold a 25 per cent interest in the on-shore LNG plant. Chevron is targeting a final investment decision on an initial two-train project in 2011.
MEO Price at posting:
63.0¢ Sentiment: Buy Disclosure: Held
