“Chevron Corp. (CVX), the second-largest U.S. energy company, agreed to pay as much as $349 million to join Beach Energy Ltd. (BPT) in an Australian natural gas exploration campaign in its first shale investment in the country.
Chevron will acquire as much as 60 percent of a permit in South Australia and 36 percent of a block in Queensland, Adelaide-based Beach said today in a statement. The blocks cover about 810,000 acres in the Cooper Basin, the outback region that straddles the border of the two states, San Ramon, California- based Chevron said in a separate statement.
The agreement follows shale investments by ConocoPhillips (COP), Statoil ASA, BG Group Plc and Hess Corp. in a nation estimated by the U.S. Energy Information Administration to have the world’s sixth-biggest potential reserves. Wilson HTM Investment Group says the accord is the biggest shale gas deal in Australia, which the government estimates may hold almost 400 trillion cubic feet of resources.
“The fact you’ve got a knowledgeable party coming in says they think there’s something there,” said John Young, a Melbourne-based analyst at Wilson HTM Investment Group. “The resource in the Cooper is being progressively de-risked and we’ll over time see a commercial development from this.”
Beach rose 5.8 percent to A$1.37 at the close in Sydney, the most in more than five months. The company had the fifth- biggest gain on Australia’s key index, which climbed 0.8 percent….”
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