Shearman & Sterling have advised PETRONAS International Corporation Ltd (PICL), a wholly owned subsidiary of PETRONAS, in the establishment of a joint venture with MISC and Mustang Engineering, a UK engineering firm, to develop floating LNG vessels, used to liquefy natural gas located in offshore gas fields.

Under the agreement, the shareholding structure of the new entity, which will be based in Kuala Lumpur, will be PICL 60%, MISC 30%, and Mustang Engineering 10%. The joint venture will be a development hub and will contract with sponsors for the design, development and construction of floating LNG vessels. The project has already progressed to achieve first gas production from a floating LNG facility in late 2013.

Lawyers who worked on the transaction included partners Bill McCormack (SI-PDF) and Tina Patel (MP-IP), and associates Scott Bagget (SI-PDF), Jayne Mander (SI-PDF) and Gloria Jung (NY-IP), with assistance from associates Christopher Le Mon (WA-LT), Parth Chanda (NY-LT) and Jenny Chao (SI-PDF), and trainee Ryan Williams (SI-PDF).

PETRONAS is a global integrated major in the LNG industry, and the partnership with MISC and Mustang Engineering is in line with its aspiration to further develop its leadership position in the global LNG business.