OREANDA-NEWS. June 02, 2011. China National Petroleum Corporation has approved a move by subsidiary China Huanqiu Contracting & Engineering Corporation (HQCEC) to take a 19.9% stake in Australian company Liquefied Natural Gas.

HQCEC also confirmed the Australian company had met conditions relating to its Fisherman’s Landing LNG Project in Queensland after it had obtained a Petroleum Facility licence, LNG told the Australian Securities Exchange.

LNG said the two companies were working together on the project ahead of the placement, with managing director Maurice Brand saying he was pleased with their “cohesive working relationship.”

“The importance of the share placement cannot be overstated, as the relationship with the CNPC-HQCEC group brings with it the technical and financial credibility needed to progress the Fisherman’s Landing LNG Project and pursue other LNG project opportunities in Australia and overseas,” he said.

HQCEC still requires approval from the Chinese Ministry of Commerce and National Development and Reform Commission for the deal, while LNG will seek the approval of its shareholders at a meeting on 7 June.

Under the deal HQCEC or an affiliate will be appointed as the sole Engineering, Procurement, Construction and Commissioning contractor for the Fisherman’s Landing LNG Project under the deal, with CNPC-associated companies getting the right to use LNG process technology around the world.

In turn, another key provision of the agreement is that CNPC or an affiliate consider the purchase of all or part of the proposed initial 3 million tonne per annum LNG production capacity of the project’s first two LNG trains.