LNG Ltd, Arrow Energy’s partner in the Fisherman’s Landing liquefied natural gas project at Gladstone in Queensland asked for a trading halt yesterday ahead of an announcement promised for today that would clarify its immediate relationship with Arrow.
Arrow is tipped by some market sources to produce a response today, to last week’s $3.3 billion takeover bid by Shell and PetroChina.
According to some market commentators, Arrow will reject the offer because it is not happy with the price and terms.
That could indicate that relations between Arrow and Shell, its biggest shareholder, are not good, as other reports last week suggested.
LNG told the ASX yesterday that it will "provide a market update in relation to the Company’s Gladstone LNG Project, Fisherman’s Landing, Port of Gladstone, Queensland and the proposed sale of the Gladstone LNG Project to Arrow Energy Ltd.
"The Company considers the announcement may have a material impact on trading in the Company’s securities and as such the market should be provided time to receive and review full details of the sale.
"The Company proposes to issue an announcement to the ASX on or before Tuesday 16 March 2010 providing full details of the market update and status of the proposed Sale."
If the takeover of Arrow is successful, Shell and PetroChina are expected to dump the Fisherman’s Landing project and instead use Arrow’s coal seam gas reserves in Arrow’s own nearby project at Curtis Island in Queensland.
Arrow said on February 11 it would acquire Gladstone LNG Pty Ltd, an LNG subsidiary, for an up-front consideration of $51 million.
Shell and PetroChina are offering $4.45 a share for Arrow, plus a share in Arrow’s international assets. That has an unknown value, but some valuations have put a notional 90c a share on it.
Arrow shares rose 5c yesterday to close at $5.25.
LNG shares last traded at 51 cents before the halt.
