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Planet Ark World Environment News Australia, Mexico to sign energy pact in November

Date: 10-Sep-04
Country: AUSTRALIA

The two nations had hoped to sign a memorandum of understanding during an international meeting of energy officials in Sydney this week.

However, Mexico's energy secretary Fernando Elizondo was forced to cancel his visit. The pact is now scheduled to be signed in November, said Australian energy minister, Ian Macfarlane.

"It's a memorandum of understanding covering technology exchange, issues relating to LNG terminals in Mexico, particularly Baja California, and I assume it will also contain issues relating to greenhouse gas," Ian Macfarlane told reporters on the sidelines of the meeting.

Australia is the world's largest coal exporter, bringing in A$11.9 billion ($7.6 billion) in export revenue in fiscal 2002-2003. It also exports millions of tonnes of liquefied natural gas annually, mostly to Asia.

Macfarlane said the pact would not include supply deals, though the 2 countries had earlier this year held preliminary discussions over supply contracts.

Australia is keen to tap the growing market on the U.S. West Coast, where several LNG receiving terminals have been proposed, but face tough environmental hurdles before being approved.

It has also been pitching its gas to Mexico where 4 terminals are planned by 2008.

U.S. oil major ChevronTexaco Corp. (CVN.N: Quote, Profile, Research) aimed to build a $650 million offshore LNG terminal in northern Mexico's Baja California by 2008, to accept gas from the A$11 billion Gorgon gas field off the Australian west coast.

Macfarlane said Australia also hoped to sell LNG to Canada, where construction of at least 8 receiving terminals was being considered.

Canada's deputy energy minister George Anderson earlier told the gathering at least 5 terminals had been proposed in eastern Canada and 3 off the western coast.

Algerian Oil Minister Chakib Khelil told the meeting his country was seeking to market LNG to the U.S. West Coast.

"...the market in the U.S. will develop... maybe through Mexico and Canada more than via new sites in the U.S. West Coast," Khelil said.

Algerian state oil and gas producer Sonatrach is the world's second largest exporter of LNG.

All of Australia's LNG is produced by the North West Shelf Joint Venture, operated by Woodside Petroleum Ltd. (WPL.AX: Quote, Profile, Research) .

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