LNG News Editor:
Australian coal-seam gas producer Senex Energy said it had received an A$815 million (US$605M) takeover proposal from POSCO International Corp., the South Korea industrial company, seeking to secure LNG imports.
The offer from POSCO International, the trading arm of the South Korean steel-making company, has already been improved several times after initial approaches.
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The current POSCO offer represents a 15 percent premium over Senex's share close on October 15 and nearly 38 percent over its close at the start of September.
A POSCO statement said the company was pursuing an acquisition of Senex as part of its efforts to secure natural gas reserves for energy security.
Senex is looking to more than triple its annual output to 9.8 million barrels of oil equivalent (1.6 billion cubic metres of natural gas) by June 2025, which will help it meet a 15-year agreement to supply the Gladstone LNG plant in Queensland, operated by Australian energy company Santos.
Among the other shareholders in Gladstone LNG is Korea Gas Corp., South Korea’s state energy company and operator of four LNG import terminals.
Senex, based in Brisbane in Queensland, has been a rapidly growing gas producer supplying Australia's East Coast market, where prices have more than doubled over the past six years following the start of three LNG export plants.
The Senex assets are centred on the onshore Surat Basin one of the main coal-seam gas (CSG) resources that supply three LNG plants and domestic gas markets.
The other two LNG plants apart from the Gladstone facility, all located on Curtis Island, are the Shell-operated Queensland Curtis LNG plant and the ConocoPhillips-run Australia Pacific LNG facility.
POSCO International, which is listed on the Korean Stock Exchange, submitted a revised non-binding and indicative proposal to acquire 100 percent of Senex for a cash offer price of A$4.40 per share.
This followed the submission of two prior non-binding proposals on 30 July 2021 (offer price: A$4.00 per share) and 27 August 2021 (offer price: A$4.20 per share).
Senex on September 15 granted POSCO a period of exclusivity to complete their due diligence enquiries and further advance the proposal.
“Following further discussions between the parties, Senex has now agreed to extend POSCO International’s exclusivity period to 5 November 2021, in order to provide POSCO International with additional time to assess a further revised proposal at a price higher than A$4.40 per share,” said Senex.
