Sydney Morning Herald: Shell's Simon Henry won't rule out write-down on Arrow LNG in Queensland

Royal Dutch Shell has declined to rule out a write-down of its multibillion-dollar investment in its Arrow Energy natural gas venture in Queensland, depending on decisions taken to develop the gas after the oil major's $US92 billion ($116.62 billion) takeover of BG Group.

Chief financial officer Simon Henry told investors in London that the Arrow venture, owned equally by Shell and PetroChina, needed to think about "the best way forward to monetise" Arrow gas and create value from its position. 

It also would have to think about the impact on Arrow from the takeover of BG, but couldn't do that until the deal was set to close, he said.

Arrow owns tracts of undeveloped coal seam gas acreage in the Surat and Bowen basins in Queensland and had been in talks to potentially supply gas to one or more of the three LNG projects being built in the state, after abandoning its plans for a stand-alone LNG project using its own resources. However, the recommended takeover of BG, announced in April, will affect the fate of Arrow gas, which is widely expected now to be used in BG's Queensland Curtis LNG project. MORE