In order to prepare for the energy transition era, POSCO International is seeking global mergers and acquisitions (M&As). Through the acquisition of Senex Energy, an Australian natural gas company, the corporation has been aggressive in developing its energy sector. Previously, the company’s energy business was focused in Myanmar, Malaysia, and Indonesia.
POSCO International stated on Sunday that it has entered into a joint investment agreement with Hancock Energy to purchase Senex Energy shares. The company anticipates completing the acquisition proceedings in March of next year, pending the results of Senex Energy’s general shareholders’ meeting and local court permission.
Since POSCO International was merged into POSCO Group in 2010, this is the largest global M&A deal. The deal is valued at $779 billion ($885 million Australian), with POSCO International investing 50.1 percent and Hancock 49.9%.
Senex Energy is the sixth-largest natural gas producer and developer in Australia. Senex Energy secures 19 billion cubic feet of natural gas per year, which is sold consistently to the eastern half of Australia.
Senex Energy supplies innovative mining with reduced investment risks, which prompted the acquisition. Furthermore, the company determined that the investment costs and economic feasibility were high because it could be sold to a variety of customers in the eastern region of Australia, where industrial complexes are concentrated, as well as using existing onshore gas pipelines.
POSCO International obtained roughly 82 billion cubic feet of natural gas reserves as part of the deal, accounting for 44% of Korea’s annual natural gas demand in 2019, while also recruiting expertise for onshore gas field operations in Australia.
Furthermore, through a carbon capture and storage (CCS) project utilizing the Senex Energy gas field to produce blue and green hydrogen, the stable liquefied natural gas (LNG) company is planned to contribute to POSCO Group’s carbon-neutral policy.
“Natural gas plays a critical part in preparing for the coming hydrogen economy era. It will provide us with an opportunity to reaffirm our position “Joo Si-bo, the CEO of POSCO International, highlighted this.
