The Beach Energy Ltd (ASX: BPT) share price ended Monday's trading session in the green. However, the company's shares could be on watch Tuesday following an after-market release.
At the closing bell, Beach Energy shares finished up 4.22% to $1.235 a pop.
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What did Beach Energy announce?
The Beach Energy share price could be on the move on Tuesday after the energy producer announced a positive update.
In its release, Beach Energy advised it has entered into a Heads of Agreement (HOA) with oil and gas company, BP.
The arrangement relates to the supply of Beach Energy's share of liquefied natural gas (LNG) from Waitsia Gas Project Stage 2.
The HOA contains the terms and conditions for BP purchasing all 3.75 million tonnes of Beach's expected LNG volumes. This is expected to come from the Waitsia Gas Project Stage 2, with supply forecasted to commence in the second half of 2023.
Beach Energy noted that the annual contract volumes and supply terms are similar to the North West Shelf Gas Processing and Lifting Agreements. The terms include built-in flexibility, ensuring that LNG will flow when construction and commissioning activities have been completed.
Supply will be delivered on a Free on Board (FOB) basis from the NWS facilities in Karratha, Western Australia. BP is a joint venture partner in NWS.
The agreed price for the LNG contract is said to be linked to Brent crude oil and Japan Korea Marker price indices.
Beach and BP are targeting the execution of an LNG Supply and Purchase Agreement later this year.
About the Beach Energy share price
Over the last 12 months, Beach Energy shares have fallen around 10%, with year-to-date dropping more than 30%. The company's share price is hovering around the lower point of its 52-week range of $1.01 and $2.04.
Beach Energy presides a market capitalisation of roughly $2.82 billion, with approximately 2.3 billion shares on its registry.
