* MidOcean raises Gorgon stake to 1.417% from 1.0%

* Takes JERA's 0.735% interest in Ichthys project

* Total deal valued under $500 million, source says

* Parties to explore broader LNG strategic alliance

TOKYO/HONG KONG, March 12 (Reuters) - MidOcean Energy,

an LNG company backed by U.S. energy-focused private equity firm

EIG, has agreed to acquire additional Australian liquefied

natural gas project stakes from Japan's JERA, the companies said

on Thursday.

The transaction covers JERA's 0.417% interest in the

Chevron ( CVX )-operated Gorgon project - lifting MidOcean's stake to

1.417% - and JERA's 0.735% interest in the Inpex ( IPXHF )-operated

Ichthys LNG project, the companies said in separate statements.

They aim to close the transaction during the first half of

2026, and did not disclose financial terms.

A source with direct knowledge of the matter said the total

deal value is under $500 million.

A JERA spokesperson confirmed JPMorgan ( JPM ) acted as

sell-side adviser to JERA.

UBS acted as financial adviser to MidOcean and

White & Case as legal adviser, according to MidOcean's

statement.

MidOcean, JERA, JPMorgan ( JPM ) and UBS did not immediately respond

to requests for comment on the deal size.

"This transaction advances MidOcean's strategy to build a

scaled, globally diversified LNG company anchored by

high-quality assets and counterparties," said MidOcean Chairman

and EIG CEO R. Blair Thomas.

The deal will increase MidOcean's exposure to one of

Australia's largest LNG projects in Chevron ( CVX )-operated Gorgon,

strengthening its footprint in the Asia-Pacific gas market,

MidOcean said in its statement.

Gorgon comprises three LNG trains with total nameplate

capacity of about 15.6 million metric tons per annum. It is now

the largest LNG exporter in Australia, which until exports from

Qatar were constrained was the third-largest LNG exporter in the

world.

MidOcean acquired its initial 1% stake in Gorgon from Tokyo

Gas ( TKGSF ) in 2024.

MidOcean also holds a 1.25% stake in Shell-operated

Queensland Curtis LNG, and EIG was involved in a failed bid for

Australia's second-largest oil and gas producer Santos

late last year.

MidOcean is a liquefied natural gas platform established by

EIG, one of the world's largest investors in energy and

infrastructure, while JERA is Japan's biggest power generation

company.

MidOcean said the deal would add uncontracted equity volumes

to the company portfolio. Uncontracted volumes are also known as

spot cargoes, whose costs have increased since the beginning of

the U.S. Israel - Iran war thanks to supply constraints.

MidOcean and JERA said they are exploring a broader

strategic alliance, which could include potential cooperation

across LNG supply, trading and decarbonisation initiatives.

Meanwhile, JERA retains its investments in Australia's

Wheatstone LNG project, the Barossa gas project and the

Scarborough gas field development, the company said in its

statement.

"Australia remains strategically important to JERA as a

trusted and reliable supplier of LNG, and JERA looks forward to

many more years of energy security for Australia, Japan and the

region," said Ryosuke Tsugaru, senior managing executive officer

at JERA.

JERA has been ramping up new upstream and supply deals,

including with the United States and Qatar, to rebalance its

supply mix and reduce its reliance on the dominant supplier,

Australia.

A separate source said JERA's divestment was not unexpected

and reflects a portfolio rebalancing, adding that both Gorgon

and Ichthys have relatively high carbon dioxide intensity.