Oil and gas firm BG gives up Origin interest
Oil and gas firm BG Group today conceded defeat in its attempt to buy Australian company Origin Energy.
BG will not raise or extend its £6.7bn (€8.3bn) offer after Origin agreed a deal with ConocoPhillips to spin off its coal-seam gas (CSG) assets.
The deal on Monday saw shares in Origin surge. BG said the price of the new joint venture was higher than it could justify and its offer will now lapse.
Oil and gas producer BG had been eyeing Sydney-based Origin as a route to expanding its presence in the region and bolstering its assets in CSG – methane gas trapped underground in deep coal seams by water.
Origin had been on the brink of accepting the offer, but changed its stance at the last moment when an industry deal to build a liquefied natural gas plant using CSG set a new benchmark for valuing the resource.
BG responded to Origin’s rejection by launching an offer direct to the company’s shareholders.
Origin also has more than 2.7 million power customers in Australia, New Zealand and the Pacific alongside its exploration and production activities. It has around 3,000 staff and was demerged from Boral, Australia’s biggest construction and building materials firm, in 2000.
As well as finding natural gas, it also produces environmentally-friendly power from solar, wind and hydro-electric generators.
