China’s Sinopec Hikes Stake in Australia LNG project by 10%, Boosts Shares of Origin Energy

China Petrochemical Corp (Sinopec) has agreed to raise by 10 per cent its equity interest holdings in the Australia Pacific liquefied natural gas project. The LNG project is a joint venture between Origin Energy Ltd. and U.S. giant ConocoPhillips.

The increase effectively gives Sinopec, Asia's biggest refiner, 25 per cent control over the LNG project, from an earlier 15 per cent, while Origin's and ConocoPhillips' ownership interests fall to 37.5 per cent each, Sydney-based Origin Energy Ltd. said in a statement on Monday.

Shares of Origin Energy Ltd. spiked during early Monday trading upon the pronouncement went up by $0.42, or 2.9 per cent, at $14.71, bettering a 1.5 per cent rise in the broader market, figures from the Sydney Morning Herald showed.

Sinopec is also poised to buy an extra 3.3 million metric tonnes of LNG annually through 2035.

Chinese energy companies have been targeting overseas oil and gas assets, with bids currently placed at $16 billion over various mining companies in strategic locations around the world, all in a bid to expand domestic reserves and supply.

Recently, Sinopec had invested invest a total of $5.2 billion in Galp Energia SGPS SA's Brazilian unit, taking a 30 per cent stake.

ConocoPhillips, the United States' third-largest oil company, and Origin had earlier agreed to supply Sinopec with 4.3 million tonnes of LNG a year. Expected annual capacity from stages one and two of the project is 9 million tons.