Hess eyes Asian markets with Australian LNG

Natural gas taken from the deepwater deposits off the northwest coast of Australia could find their way on the Asian market, U.S. company Hess Corp. said.

Hess, through its Australian subsidiary, signed a non-binding letter of intent with regional joint venture North West Shelf to develop deepwater gas basins off the Australian coast. Hess would then market liquefied natural gas to customers in the Asia-Pacific.

The deal would allow Hess to take advantage of reserves locked in the Equus gas basin.

"This arrangement would bring together Hess' strong deepwater drilling and development capabilities with NWS's proven track record in natural gas processing and liquefaction," President and Chief Operating Officer Greg Hill said in a statement.

North West Shelf is a joint venture between BHP Billiton, BP, Chevron, Shell, Australian energy company Woodside and Japan Australia LNG.

The Hess announcement follows notification that a tanker designated to take the first shipments of LNG from the Gladstone project in Australia has arrived at port. Project leader BG Group said the first shipment would likely go to an Asian customer.

Asian demand for natural gas is expected to grow by as much as 8 trillion cubic feet by 2020. The International Energy Agency said LNG, a super-cooled and denser product with more deliverability options, represents "a golden opportunity" for Asian economies.