BHP Billiton Limited, together with the other participants in the North West Shelf Venture, has signed a Letter of Intent (LOI) with the Korea Gas Corporation (Kogas) for the purchase and supply of liquefied natural gas (LNG) from the North West Shelf in Western Australia.

The LOI was signed by the six NWS LNG Sellers and covers the supply of approximately 0.5 million tonnes of LNG a year to Kogas for seven years starting in late 2003. The LNG will be used for power generation gas and town gas supply.

The parties will now move to finalise sales and purchase agreements.

President and CEO BHP Billiton Petroleum Philip Aiken is delighted with the deal.

“The LOI with Kogas not only represents the beginning of a significant LNG supply relationship with Kogas, but it again reinforces the NWS Venture’s position as a competitive, reliable and secure supplier of LNG to the Asian region,” Mr Aiken said.

BHP Billiton has a 16.67 per cent equity interest in the North West Shelf Project.