British energy producer BG Group said Wednesday it has sold its Australian gas pipeline business for US$5.0 billion as part of its plan to shed non-core assets.
Australia`s APA Group, the nation`s largest gas infrastructure business, has agreed to buy the QCLNG Pipeline division for the equivalent of 4.0 billion euros, BG said in an official statement.
QCLNG Pipeline Pty Ltd owns a 543-kilometre (337-mile) underground pipeline network linking BG`s natural gas fields in southern Queensland to a two-train liquefied natural gas (LNG) export facility at Gladstone on the east coast.
"We are pleased to have entered into an agreement for the sale of this high-quality infrastructure with a bidder the calibre of APA Group," said BG Group`s interim executive chairman Andrew Gould.
"The sale of the QCLNG pipeline is in line with our strategy to focus on BG Group`s core areas of oil and gas exploration and production and LNG."
The pipeline was constructed between 2011 and 2014 and has a current book value of US$1.6 billion, according to BG.
The divestment is expected to complete in the first half of next year, and result in a post-tax profit of about US$2.7 billion.
BG Group added that the sale proceeds would be used to slash debt and fund future growth investment.
The company also said Wednesday that it was undertaking a review of its business plans after recent sharp falls in the cost of crude.
World oil prices have tumbled by more than 40 percent since June and struck fresh five-year lows on Tuesday on the back of the strong dollar, growing demand concerns in the faltering global economy, and plentiful crude supplies.
"BG Group is reviewing its reference conditions, long-term price assumptions and business plans in light of recent movements in commodity prices, particularly oil," it said.
"Any impact of changes to these assumptions on the carrying value of assets within the group`s portfolio will be reflected in the 2014 fourth quarter results."
The company will publish its fourth-quarter and full-year earnings on February 3, 2015.
