Chevron Seals Binding LNG Sales Deal With Japan's JX Holdings

Chevron Corp. (CVX) said Tuesday it has signed a binding agreement with Japan's JX Holdings Inc. (5020.TO) to sell liquefied natural gas from the A$43 billion Gorgon project in Western Australia state.

Finalization of the deal follows the signing of a preliminary agreement in January, and comes as Japanese customers seek to lock in long-term LNG supply following the earthquake and tsunami that caused widespread damage to Japan on March 11.

JX Nippon Oil and Energy Corp., a unit of JX Holdings, will take 300,000 metric tons of LNG annually from the Gorgon project for 15 years--in line with the terms agreed in the initial deal with Chevron.

Chevron said Gorgon, which it operates with a 47% stake, is progressing well and first gas is still scheduled to be shipped in 2014. The project counts ExxonMobil Corp. (XOM) and Royal Dutch Shell PLC (RDSB.LN) as major shareholders.

In addition to JX Holdings, Gorgon's customers include Osaka Gas Co. (9532.TO), Tokyo Gas Co. (9531.TO), PetroChina Co. (PTR) and India's Petronet LNG Ltd. (532522.BY).

-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692; [e-mail]