Global mining giant BHP Billiton Ltd has finished the sale of its stake worth $1.6 billion in Australian oil and gas major Woodside Petroleum Ltd's Browse liquefied natural gas (LNG) project in Western Australia to Chinese state-owned oil giant PetroChina Co Ltd.
In a statement BHP said that all required approvals have been secured and relevant documents were signed in Beijing to finalise the transaction.
''This sale reflects BHP Billiton's exit from the Browse Joint Ventures,'' the company said.
The assets sold include BHP's 8.3-per cent stake in East Browse JV and a 20-per cent interest in the West Browse JV.
The $45-billion Browse LNG project consists of three gas fields Brecknock, Calliance and Torosa which lie in the Indian Ocean, 425 km north of Broome on the Kimberly coast and contains significantly large reserves of about 15.5 trillion cubic feet of gas and 417 million barrels of condensate.
BHP's stake sale plan which surfaced in December came under a cloud following Woodside's decision to change the original Browse LNG development plans in April due to high costs. Woodside, the largest equity holder and operator of the project, said that the development concept did not meet the company's commercial requirements for a positive final investment decision.
The company has scrapped plans for a controversial onshore LNG processing plant, and instead said that it may consider using the cheaper floating plant technology, with a pipeline connecting its LNG facilities in Pilbara.
Woodside's other partners in the project include Royal Dutch Shell, BP and Japan Australia LNG.
BHP and PetroChina have now concluded the transaction based on the terms of the December agreement.
In a recent visit to Japan on a trade mission, Western Australian premier Colin Barnett said that Western Australia is poised to become a major energy supplier to Japan, despite stiff completion from the US due to the shale gas revolution.
He said Japan has to secure alternate energy sources for the future, as a result of the country's aversion for nuclear power following the Fukushima catastrophe two years ago, further stating that it may have to boost its gas imports to fill the gap in the next 10 years.
Meanwhile, BHP's new chief executive Andrew Mackenzie who took charge two months ago, said Sunday in London that after his recent meeting with Chinese premier Li Kequiang, he was optimistic that resource markets would remain strong though less intense compared to the first decade of the century.
''Li was extremely reassuring about the demand for resources,'' Mackenzie said.
In recent months, BHP has been taking measures to cut costs through the sale of non-core assets, slashing new exploration activities and improving mine productivity as a result of the slump in the commodities market.
"Somehow, finding those $5 of savings in unit costs per tonne did not seem that important when prices were skyrocketing, but it really matters now," Mackenzie said.
Just 1 per cent saving in costs translates into an additional profitability of $170 million annually, he added.
Recent sales include the company's diamond business to Canada's Dominion Diamond Corp for $500 million and Pinto Valley copper-molybdenum mining operation to Capstone Mining Corp, also a Canadian base metal miner, for $650 million.