ACCC Grants Interim Authorization To Gorgon Gas Project Joint Venture

The Australian Competition and Consumer Commission (ACCC) has decided to grant conditional interim authorization to the Gorgon gas project joint venture to engage in joint marketing of natural gas to customers in Western Australia. Interim authorization allows the joint venture participants to continue to engage with potential customers and obtain information relevant to their investment decision, while the ACCC assesses the substantive applications for authorization.

The Gorgon Gas Project is a major greenfields project which will provide a new source of natural gas to the Western Australian market and will involve a substantial level of upfront investment by the joint venture participants, said, ACCC Chairman, Graeme Samuel.

The ACCC accepts that the joint venture participants need to engage with the market before making a Final Investment Decision in relation to this major capital investment.

Samuel said the ACCC considers that granting interim authorization is unlikely to result in irreversible changes to the market, particularly since any gas sales agreements entered into during the period of interim authorization will be conditional on the ACCC granting final authorization.

A number of interested parties raised concerns about providing commercially sensitive information to the joint venture participants under an interim authorization.

In order to address this concern, the ACCC has decided that interim authorization will only come into effect once the applicants have had their ring fencing arrangements independently audited and any changes required to make them effective have been implemented.

The ACCC may review its decision on interim authorization at any time. The ACCC's decision in relation to interim authorization should not be taken to be indicative of whether or not final authorization will be granted.

The ACCC is currently undertaking public consultation on the substantive applications for authorization, prior to making a Draft Determination by September 2009. Public submissions on the applications are due on July 3, 2009.

The joint venture participants are Chevron Australia Pty Ltd, Chevron (TAPL) Pty Ltd, Mobil Australia Resources Company Pty Ltd and Shell Development (Australia) Pty Ltd.