Australia Primed For More M&A

MELBOURNE, June 25 (Reuters) – Private collateral firms are expected to operate a vehicle with an influx of merger activity in Australia’s gas sector, hunting for good deals amid soaring demand in China, increasing local prices, and a broader oil market recovery. 9.8 billion bets for pipeline operator APA Group by Hong Kong’s CK Infrastructure. Still, the share prices of smaller companies in the sector have yet to totally reflect the sharpened recovery in oil markets within the last year and increases from lower drilling costs, say bankers and consultants.

Perth-based Deloitte Consulting partner Bernadette Cullinane. 392 million) in March for Australia’s Sino Gas & Energy Holdings, which include stakes in two shale gas projects in China. More deals have emerged as small coal and oil companies look to finance new gas developments to feed the east coast market and bigger companies, like Santos, look to replenish their reserves, pursuing years of cuts in exploration.

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Eddie Rigg, mind of corporate financing at Argonaut, who advised a private Chinese company that lost out in a three-way bidding battle for gas producer AWE Ltd in February. Such companies include Senex Energy, Central Petroleum, Cooper Energy, and Strike Energy. Rigg predicted Sino Gas shall attract a rival bid from a U.S., European or Asian group as most of the geological and well engineering risks on its project have been handled.

Australian domestic gas prices have significantly more than doubled before 3 years as east coastline source has been sucked into exports of liquefied natural gas (LNG) to supply Asia-Pacific demand. China’s LNG imports, powered by a clean air push, are anticipated to jump 50 percent over 3 years to 57 million tonnes by 2020, regarding Australian government forecasts.

For traders, Australia is a helpful way to try out into that development. Another likely target is within Australia’s western. 3 billion is bringing in interest as you of its two owners, Canada’s Brookfield Asset Management, is looking to sell its stake, bankers say. Quadrant, co-owned by Macquarie Group, produces more than a fifth of the gas entering the domestic market in the constant state of Western Australia, has oil production and untapped gas reserves. Potential suitors include Santos. Wood Mackenzie analyst Saul Kavonic. Santos, Macquarie, and Brookfield declined to comment.

Within the next two years, there may be other offers on the western coast, where Woodside Chevron and Petroleum Corp. are looking to develop new gas fields to nourish their LNG plant life. The biggest hurdle to their plans is the many co-owners in their gas fields and LNG plants – all with competing priorities – which makes it difficult to agree on development plans. 744 million purchase of ExxonMobil’s stake in the Scarborough gas field. Chevron’s Asia-Pacific exploration and production chief executive Stephen Green said in a recent group interview.