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Talisman Energy has operations in Canada and its subsidiaries operate in the UK, Norway, Southeast Asia, North Africa and the United States.
Talisman inks natural gas joint venture in Papua New Guinea with Mitsubishi
Talisman Energy (TSX:TLM) Wednesday has embarked on a partnership with Japan's Mitsubishi to develop natural gas properties in Papua New Guinea.
The Calgary-based oil and gas explorer said that Mitsubishi will pay about $280 million to form a joint venture on nine licences in the country. Talisman will hold about a 40 percent stake in the licences, while Mitsubishi will hold 20 percent.
This is the second recent move by the Japanese company to secure gas assets from a Canadian producer.
Last week, the Japanese industrial giant signed a nearly $3 billion deal with Canadian Encana (TSE:ECA) to acquire a stake in a major B.C. gas field.
Demand for gas is soaring in Japan since last year's Fukushima nuclear disaster which resulted in the nation shutting down most of its nuclear reactors. Japanese demand for liquid natural gas (LNG) jumped 12 percent to a record 78.5 million tonnes in 2011.
Papua New Guinea has huge gas deposits in its western provinces and the island country off the north coast of Australia is being explored by Canadian, Australian and global companies.
In the Talisman deal, the companies are looking to export about three million tonnes a year of liquefied natural gas.
In a statement, Talisman vice-president Paul Blakeley said that Mitsubishi "brings extensive experience in LNG development and marketing and I am confident they will be a key success factor in helping us unlock the value of our Papua New Guinea assets."
LNG is seen as a way to globalize the natural gas market, as the crude oil market has been for decades. By contrast, natural gas trade has been limited to markets that can be served by pipelines, such as North America and Europe.
Besides Talisman and Encana, global companies involved in major LNG projects include Chevron (NYSE:CVX) and Royal Dutch Shell (NYSE:RDS.A). Shell, in fact, already began diverting global LNG shipments to Japan last year to meet rising demand.
The recent deals reflect a growing belief in Asia that Canada could eventually become a major LNG supplier if it builds terminals on the West Coast to liquefy huge new supplies of shale gas from northeastern B.C. and the Far North.
