Official documents have a habit of being removed from the internet or moved onto different locations on government websites so we publish the 2010 letter from Catherine Tanna (QGC/BG Group) to Queensland Premier Anna Bligh in full here.
Qld Premier Anna Bligh tabled a letter in parliament in March 2010 from BG Australia chairman and Reserve Bank of Australia board member Catherine Tanna saying a deal had been signed to supply $60 billion of coal seam gas to China. QGC is part of the BG Group.
People in attendance at that Chinese meeting included federal Minister for Resources and Energy Martin Ferguson (who now sits on the advisory board of the peak body representing the gas industry – APPEA and the global board of BG Group), BG Group London boss Frank Chapman (now Sir Frank) and Prince Andrew in a trade role.
This document supports our feature story: How the Queensland Government fracked the state
24 March 2010
Anna Bligh, MP
Premier of Queensland
Level 15 Executive Building
100 George Street
BRISBANE QLD 4000
Dear Premier
I write today from Beijing to advise that BG Group – the parent company of QGC Pty Limited – and the China National Offshore Oil Corporation, have just signed one of Australia’s largest sales and purchase agreements for liquefied natural gas.
The contract allows for China to buy 3.6 million tonnes of Queensland liquefied natural gas each year for 20 years from 2014.
The sales contract was signed by the BG Group chief executive, Frank Chapman, and the CNOOC president, Fu Chengyu. It was witnessed by the Federal Minister for Resources, Energy and Tourism, Martin Ferguson, the Duke of York, and the Vice Minister of China’s National Energy Administration, Liu Qi.
QGC plans to produce coal seam gas from its petroleum licences in the Surat Basin and transport it by pipeline for export at the Queensland Curtis LNG plant on Curtis Island near Gladstone.
When combined with our existing LNG supply agreements – a 20-year agreement with Singapore for three million tonnes a year and a 21-year agreement with Chile for 1.7 million tonnes a year – the China contract underpins full production for the first two production “trains” at Gladstone.
This achievement is remarkable, particularly as Queensland’s coal seam gas industry was virtually non-existent a decade ago and plans for a liquefied natural gas industry emerged only two to three years ago.
We thank you and your Government for the assistance and support you have given the gas industry to allow us to reach this milestone.
Similarly, we thank your public servants for their hard work and support in ensuring we have made such good progress.
While success should be celebrated, we still have a significant way to go to ensure that the QCLNG Project proceeds to a final investment decision later this year. We look forward to your continued support and to bringing you further good news.
Yours sincerely
Catherine Tanna
Executive Vice President, BG Group
Managing Director, QGC Pty Limited
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On the Queensland government website, mirrored on 1EarthMedia (PDF)
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Premier Anna Bligh responded with the following press release which has since been removed from the Queensland Government website:
Premier and Minister for the Arts
The Honourable Anna Bligh
Wednesday, March 24, 2010
World first with Queensland LNG contract
Up to 8,500 Queensland jobs will be created and $60 billion in export activity from the state is set to begin after the signing of a landmark deal for the world’s biggest liquefied natural gas contract based on coal seam gas, Premier Anna Bligh announced today.
Ms Bligh said the BG Group and the China National Offshore Oil Corporation (CNOOC) today signed Australia’s largest liquefied natural gas contract between two single companies to supply 72 million tonnes of LNG from Queensland over the next 20 years – a deal which rivals the North West Shelf deposit off Western Australia.
The Premier said the gas would be supplied to China from 2014 from the Queensland Curtis LNG Project which is currently under development in Gladstone by the BG Group’s subsidiary, QGC Pty Limited, with up to $10 billion expected to be spent in construction over the next four years.
Ms Bligh said the project included:
· A significant coal seam gas development in the Surat Basin of southern Queensland
· A 540km pipeline network linking the gas fields near Chinchilla to the LNG plant at Gladstone in central Queensland
· An LNG plant on Curtis Island, near Gladstone, initially comprising two processing units, or “trains”, possibly to be followed by a third unit.
“This is an historic day for Queensland’s mining industry, for our state’s economy, for our regions and for our workforce,” Ms Bligh said.
“This agreement signals the beginning of a new era in the evolving LNG industry with thousands of jobs and billions of dollars in export revenue for Queensland.
“It is placing Queensland front and centre of this growing industry and means we are now a leading player in the global LNG market.
“At its peak during construction of the plant in Gladstone, gas fields in Chinchilla and Miles and construction of the pipeline, it will have a peak work force of 8,500.
“Once operational, this project will employ a further 1,000.
“The BG Group’s contract with the China National Offshore Oil Corporation is the country’s largest LNG contract between two single companies and will supply 72 million tonnes over 20 years from 2014.
“Our government has actively encouraged and supported this industry and in 2008, we declared the project significant and an environmental approval under Federal and Queensland legislation is expected by mid-2010.”
With the support of the Bligh Government, the multi-billion dollar gas fields will be centred in Surat Basin region with seven proposed projects in Gladstone alone and another in Bowen at various stages.
Four have been declared significant projects overseen by the Coordinator General and are at Environmental Impact Statement stage.
“It’s an indication of just how quickly this industry is growing in terms of the BG Group’s commitment to development in Queensland that just two years ago they had three employees in the state – today there are 700,” Ms Bligh said.
“This will place thousands more workers in this region and ultimately, this is jobs for Queenslanders, royalties for the Queensland economy and billions of dollars in infrastructure for this region and its future generations.”
The project is based on coal seam gas from QGC’s fields in the Surat Basin and today’s contract is the world’s first fully termed sales and purchase agreement for the supply of LNG from coal seam gas.
Australia’s largest previous LNG contract was for 82.5 million tonnes over 25 years between the North West Shelf Project, a consortium of six companies and CNOOC. This contract was signed in 2002.
BG Group and CNOOC have also agreed to jointly participate in a consortium to construct two LNG ships in China that will be owned by the consortium.
The agreement was signed today in Beijing by the CNOOC President, Fu Chengyu, and the BG Group Chief Executive, Frank Chapman.
Original Press release was here but has since been removed from the Queensland Government website