China signs $41-billion gas deal with ExxonMobil's Australian arm

Despite their recent acrimony over the arrest of Rio Tinto executives and the failure of Chinalco's Rio deal, China and Australia signed their biggest ever trade deal today, when PetroChina signed a $41-billion liquefied natural gas import agreement with ExxonMobil's Australian arm.

The mega-deal overtakes the record-breaking $37-billion agreement signed in 2007 between PteroChina and Australia's Woodside to supply 3 million tons of LNG a year from its Browse Basin project. Earlier in April 2008, PetroChina had signed a 25-year sale-and-purchase agreement with Qatargas Operating Co. and Shell for import of 3 million tons of LNG from the Qatargas 4 project in Qatar.

This gas deal between Exxon and PetroChina comes two weeks after India's Petronet LNG Ltd signed a 20-year LNG import agreement with oil giant Exxon, reportedly worth $25 billion, from the proposed Gorgon LNG project in Australia. (See: Petronet LNG Signs 20-year gas supply deal with Exxon Mobil)

Under the 20-year deal with PetroChina, Exxon will supply 3.25 million tonnes per annum (mtpa) of LNG from the Gorgon LNG project, making China  the largest buyer of LNG from this project ahead of India's 1.5 million tons.

Prior to this deal, PetroChina had signed a 20-year contract with Royal Dutch Shell Plc, Europe's largest oil company, to import two million tonnes of (LNG) annually, partly from the Gorgon gas project in 2008. (See: Shell signs 20-year LPG supply deal with PetroChina)

The US major's Australian subsidiary has a 25-per cent stake in the $32-billion Chevron-led Gorgon LNG project on Barrow Island in Western Australia, where Chevron holds 50 per cent and Royal Dutch Shell 25 per cent.