The revised HoA will assist the joint venture to achieve a final investment decision scheduled for the first quarter of 2010, and to provide increased certainty of the project’s first LNG shipments from Gladstone in late 2012.

Under the revised proposal, the Gladstone Fisherman’s Landing LNG Project will be split into the design, construction and management of infrastructure division – known as InfraCo – and the LNG production arm, to be known as TrainCo.

InfraCo will be a joint venture between Arrow Energy and LNG Ltd subsidiary Gladstone LNG, which will own, design and construct the LNG project infrastructure, including the storage tank, jetty and ship loading facilities, and all other services, excluding the liquefaction trains.

Arrow will wholly own and develop TrainCo, which consists of a 1.5 million tonnes per annum train on land, under a sublease from InfraCo. The LNG train will include gas pre-treatment and liquefaction facilities. Arrow will also source the gas for the LNG train from its fields in the Surat Basin and subject to final agreed terms, will retain an option with InfraCo to develop an additional train.

Golar Energy, which has a HoA with LNG Ltd for the sale and purchase of LNG from the first train, also plans to participate in the restructure proposal and will have the potential in invest as part owner in both InfraCo and TrainCo.

A project director will be appointed to oversee the overall development from the Surat gas fields through to LNG production at Fisherman’s Landing.

LNG Ltd Managing Director and Chief Executive Officer Maurice Brand said “During our discussions with Arrow…the most suitable and simple commercial structure for the project involved Arrow owning the gas from initial production at the well head through to the point of the LNG buyers of Golar and Toyota Tsusho.

“The proposed restructuring principles is predicated on providing a better commercial framework to deliver the world’s first coal seam gas to LNG export facility and greater certainty through the integrated development and ownership of the LNG process,” Mr Brand said.