Origin Energy Ltd (ASX:ORG) has announced that its $35 billion Australia Pacific LNG project has inked a supply deal with China Petrochemical Corporation, also known as Sinopec.
The LNG project in Queensland is a 50:50 joint venture between Origin and ConocoPhillips, that only last week won the federal government’s environmental approval.
Origin says the project has now signed a heads of agreement with Sinopec to annually sell 4.3 million tonnes of LNG to the company for 20 years.
Sinopec has also agreed to purchase a 15 per cent stake in the venture, cutting Origin and ConocoPhillips’ interests down to 42.5 per cent.
While Origin has not as yet released an official price tag for the sale, it is expected to be one of the biggest signed out of Australia with an estimated value of up to $90 million.
Last week Origin said it had moved from a profit to a loss in the first half of its current financial year.
In the six months to 31 December 2010, Origin booked a net loss of $100 million.
