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Gold/Mining/Energy : LNG -- Ignore unavailable to you. Want to Upgrade?

To: Copperfield who wrote (255)	10/8/2004 3:39:11 PM
From: Dennis Roth	Read Replies (1) \| Respond to of 919

Gazprom, Petro-Canada to sign LNG terminal deal Fri Oct 8, 2004 01:16 PM ET By Denis Pinchuk reuters.com ST PETERSBURG, Russia, Oct 8 (Reuters) - Russian gas giant Gazprom (GAZP.MO: Quote, Profile, Research) came a step closer to the liquefied natural gas market on Friday, saying Petro-Canada (PCA.TO: Quote, Profile, Research) would help in its goal to build plants in Russia and the United States. Chief executive Alexei Miller told reporters the two companies would sign an agreement during a visit by Canadian Prime Minister Paul Martin to Moscow next week. "We are working on this project only with Petro-Canada, and we will sign an agreement with Petro-Canada," he said. The deal is expected to be similar to those Gazprom signed in September with U.S. oil major ChevronTexaco and Norway's Statoil -- memorandums of understanding with an eye toward joint projects. Gazprom and ChevronTexaco signed an MOU to study an integrated LNG project in Russia and a U.S. import terminal. Under the agreement with Petro-Canada, the duo will consider a jointly built terminal in the Baltic port of Ust Luga near St. Petersburg -- a region bristling with oil terminals but where freezing winter seas limit passage to scarce ice-class vessels. They will also study construction of a receiving terminal on the coast of the United States. Calgary-based Petro-Canada could provide no details in terms of a possible timetable, the size of facilities or the cost of the projects, spokeswoman Helen Wesley said. "All I can tell you is that we're in discussions with them and there's no deal to announce yet," Wesley said. Gazprom, the world's largest gas firm, is keen to supply hungry U.S. markets, but as yet has no LNG facility of its own to supercool gas for onward shipment. "Timescale depends on consumers, on a long-term contract," Miller said. "If there's a long-term contract, then ... technical questions can be resolved fairly quickly." Petro-Canada chief executive Ron Brenneman has said the company aims to be a key player in the growing market for LNG, especially in North America, which faces declining conventional gas production. On Sept. 1, his company and TransCanada Corp. (TRP.TO: Quote, Profile, Research) , the country's biggest pipeline firm, said the plan to build a C$660 million ($500 million) LNG plant in Quebec. Industry sources have told Reuters that Gazprom is in talks with British oil major BP Plc (BP.L: Quote, Profile, Research) to swap its pipeline gas in Europe for BP-produced LNG. Gazprom, which supplies a quarter of Europe's gas, has said it will begin LNG deliveries to the United States in 2005 by either buying the product from other firms or swapping it for its own pipeline gas in Europe. Gazprom has said the swap would allow it to learn more about the industry before it starts producing its own LNG next decade from the giant arctic Shtokman field and clinches long-term supply deals with U.S. customers. (Additional reporting by Jeffrey Jones in Calgary)