Apache (NYSE:APA), Chevron (NYSE:CVX), KUFPEC in KOGAS Deal

Chevron (NYSE:CVX), Apache (NYSE:APA) and Kuwait Foreign Petroleum Exploration Co (KUFPEC), have made a deal with Korea Gas Corporation for the purpose of acquiring liquefied natural gas.

The liquefied natural gas will be acquired from Australian-based Wheatstone project in Western Australia, according to the companies involved.

KUFPEC and Apache, who have equity stakes in the fields which supply Wheatstone, have plans to sell 5 percent of those stakes.

KOGAS has committed to acquiring 1.5 million tons of liquefied natural gas annually, with 75 percent of the gas provided by Chevron, which operates Wheatstone, and close to 25 percent from KUFPEC and Apache.

The assets being sold by Apache and KUFPEC are from the Julimar and Brunello fields, which account for the 5 percent mentioned above. When completed, KOGAS will have a 5 percent stake in the overall Wheatstone project.

Chevron (NYSE:CVX) Increases Production 7 Percent

At their annual shareholder meeting, Chevron (NYSE:CVX) CEO John Watson told investors that production for the company in the last year rose by 7 percent, and the company will continue to increase production over the next several years.

The primary engine of growth will be the Wheatstone and Gorgon natural gas projects based in Australia.

Liquid natural gas at the Gorgon project is expected to produce gas by 2014. So far they've plowed $37 billion into Gorgon. Wheatstone is at the front-end engineering and design stage, and investments decisions on that are expected to come in 2011.

Over the next three years plans are in place to launch oil and gas production in 10 capital projects estimated to cost over $1 billion each.

Another seven multibillion-dollar startups are also scheduled for 2011 and 2012.