EIG’s MidOcean Energy to buy Tokyo Gas’ stake in four Australian LNG projects for $2 billion

October 7, 2022, by Ajsa Habibic

MidOcean Energy, an LNG company formed and managed by energy and infrastructure investor EIG, has entered into a definitive agreement to acquire Tokyo Gas’ interests in a portfolio of four Australian integrated LNG projects.

Under the terms of the agreement, MidOcean will acquire Tokyo Gas’ interests in Gorgon LNG, Ichthys LNG, Pluto LNG and Queensland Curtis LNG for total cash consideration of $2.15 billion.

These integrated projects span Australia’s western and eastern seaboard and are major suppliers of LNG to Asia, with a diverse set of long-dated take or pay contracts with investment grade counterparties, and to Australia’s domestic gas markets.

The portfolio is expected to generate approximately 1 million tonnes per annum of LNG net to MidOcean.

The portfolio benefits from experienced operators, including Chevron, INPEX, Woodside and Shell, and spans the LNG value chain from upstream operations to midstream, liquefaction and sales.

The acquisition marks the launch of MidOcean’s strategy to build a high-quality, diversified, global ‘pure play’ integrated LNG company.

The transaction is expected to close in the first half of 2023, subject to customary closing conditions, including Australian regulatory approvals.

R. Blair Thomas, EIG’s chairman and CEO, said: “The launch of MidOcean reflects our deep belief in LNG as a critical enabler of the energy transition and the growing importance of LNG as a geopolitically strategic energy resource.

“We believe this transaction provides MidOcean with a foundational portfolio of cost-advantaged integrated LNG assets in a low-risk jurisdiction, ideally positioned to supply key customers in Japan, Asia and across the globe for decades to come.”

In June 2022, EIG announced that De la Rey Venter, formerly with Shell, joined MidOcean as chief executive officer, bringing 25 years of experience in global LNG operating, dealmaking and business leadership.