will be up more tonight, page-17

bhp gas buyers line up BHP gas buyers line up
By Jamie Freed, Sydney
January 27, 2006

ONE week after Woodside Petroleum announced plans to export liquefied natural gas to California, BHP Billiton said 18 large buyers had signed letters of interest in buying gas from its rival $US600 million ($A800 million) Cabrillo Port import terminal project.

No final agreements will be struck until the offshore terminal is approved by the US Coast Guard, the California State Lands Commission and Governor Arnold Schwarzenegger, which BHP believes could occur later this year.

The US Coast Guard "stopped the clock" on the approvals process last year, asking BHP to submit more information about the environmental impact of the project, which has faced fierce opposition from Californian activists.

"We're confident the information that is in there will allay the fears and concerns the environmental community had over the last year or so," Kathi Hann, BHP's California-based spokeswoman for the project, said yesterday.

A new draft environmental report is expected to be released on March 2. Cabrillo Port will then undergo a 45-day public review process including hearings in April before the relevant authorities decide its fate.

"We're hoping to have everything finalised and issued by late (northern hemisphere) summer, maybe early (autumn)," Ms Hann said.

Of the 18 potential buyers expressing interest in BHP's LNG, all names were kept confidential except for the Los Angeles Department of Water and Power.

But it is believed the letters of intent, if converted to contracts, would represent more than the terminal's LNG capacity when it opens as early as 2010.

Last week Woodside announced it would develop a rival LNG import project in California, called OceanWay.

Several other import terminal projects in California have been proposed. Woodside's North American LNG director, Jane Cutler, said last week that California was unlikely to approve more than two import terminals.

With billions of dollars in exports at stake, federal Treasurer Peter Costello was in Los Angeles last week lobbying Californians to consider importing Australian LNG.