The assets comprise AGL’s 50 per cent interest in each of the Moranbah Gas Project Joint Venture (MGPJV) and the North Queensland Energy Joint Venture (NQEJV) and AGL’s participation rights in the ATP1103 exploration licence in the Bowen Basin.
Arrow Energy is the joint venture partner in the MGPJV, NQEJV and ATP1103 assets, with AGL’s agreement with Shandong and Orient subject to pre-emptive rights Arrow holds over the MGPJV and NQEJV assets.
The MGPJV comprises producing gas fields near Moranbah and associated gas sales contracts, while the NQEJV comprises transportation rights on the North Queensland gas pipeline, a power purchase agreement to toll gas through the Yabalu power station and gas purchase and sale agreements.
If Arrow does not exercise its pre-emptive rights, the sale of Shandong and Orient remains subject to receiving Australian and Chinese regulatory approvals and securing consents from joint venture counterparties.
The sale agreement is consistent with AGL’s February 2016 announcement that it intended to exit the exploration and production of natural gas.