BG Group sells Australian gas pipeline for $5bn

Natural gas giant BG Group is to raise $5bn (£3.2bn) from the sale of a gas pipeline in Australia which is planned to go towards reducing debt and future growth investments.

The company said that the sale of the non-core infrastructure is in line with its strategy to focus on core areas of oil and gas exploration and production, as well as liquefied natural gas (LNG).

BG is selling its wholly-owned subsidiary QCLNG Pipeline Pty to Sydney-listed, Australia's largest gas infrastructure business.

It is making a pre-tax profit on disposal of $2.7bn, though this will be partly offset by a post-tax impairment of its remaining QCLNG assets, expected to be around $2bn.

QCLNG Pipeline owns a 543km underground pipeline network linking BG Group’s natural gas fields in southern Queensland to a two-train LNG export facility at Gladstone on the east coast.

It was constructed between 2011 and 2015 and has a current book value of $1.6bn.

"The sale of the QCLNG pipeline is in line with our strategy,” said executive chairman Andrew Gould.

“The timing reflects QCLNG's advanced stage of development; we are now on the verge of delivering the world's first large-scale project using natural gas from coal seams as a feedstock for LNG."