US oil firm Apache has sold off its interest in two LNG projects along with accompanying reserves to Woodside Petroleum in a $3.75billion deal.
The company is also expected to be reimbursed $1billion for its net expenditure on the two assets, Wheatstone and Kitimat.
The terms of the agreement means Apache will sell its equity ownership in its Australian subsidiary Apache Julimar.
It owns a 13% interest in the Wheatstone LNG project and a 65% interest in the WA-49-L block.
The deal also includes Apache’s 50% interest in the Kitimat LNG project and related upstream acreage in the Horn River and Liard natural gas in British Columbia.
Last month, the company agreed to sell off assets in Louisiana and the Anadarko Basin for $1.4billion in two separate transactions.
Chariman G.Steven Farris said: “Today’s announcement marks the successful completion of one of our primary strategic goals of exiting the Wheatstone and Kitimat LNG projects.
“Apache recognizes the contribution of our employees who have worked so diligently on these projects since their inception, and we sincerely thank them for their tremendous effort.
“I would also like to thank Woodside’s chief executive and managing director, Peter Coleman, and his entire staff for their hard work and professionalism in bringing this transaction to a successful conclusion.
“I am proud of Apache’s legacy in advancing the Wheatstone and Kitimat LNG projects, and I am confident that Woodside’s participation will have a positive impact in seeing these world-class LNG facilities through to first production.
“We look forward to the redeployment of the proceeds from this sale, which may be used to reduce debt, repurchase shares and to pursue other opportunities that enhance our asset base and drive profitable production growth.”
Apache said based on current estimates its net proceeds are expected to be around $3.7billion.
A spokesman said following the transaction, Apache will continue to hold upstream acreage offshore Western Australia in the Carnarvon, Exmouth, and Canning basins along with related hydrocarbon reserves and production.
It will also retain its 49% ownership interest in Yara Holdings Nitrates Pty Ltd and 10% interest in the related ammonium nitrate plant.
The transaction is expected to close in the first quarter of 2015 and is subject to necessary government and regulatory approvals and customary post-closing adjustments.
The sale of the Kitimat LNG project is subject to certain operator consents.
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