BHP Billiton announced today that it has agreed to sell its Australian coal bed methane (CBM) interests to The Australian Gas Light Company (AGL) for US$68.7 million. The sale will be effective 1 January 2006, with the transaction expected to be completed over the coming months. The acquisition price is subject to revenue and cost adjustments between the effective date and completion. AGL has also agreed to pay BHP Billiton a further amount should AGL seek to acquire additional interests in the assets subject to the sale within a 12 month period.
BHP Billiton’s principal CBM asset in Australia is a 50% interest in the Moranbah Gas Project (MGP), a Joint Venture between BHP Billiton and CH4 Gas Limited. The MGP is located in the Bowen Basin, approximately 400km south of Townsville and 170km west of Mackay. The MGP has gas sales contracts with Enertrade and Ergon Energy.
BHP Billiton is also assigning its interests in the exploration permit ATP-364-P and the various contracts associated with its Australian CBM interests to AGL.