Group signs 10-year deal to buy 500,000 tons LNG annually

Chinazor Megbolu |

An organisation, Vitol, has signed a 10-year deal with Nigeria Liquefied Natural Gas (NLNG) to buy 500,000 tons of LNG annually.

The Commodity trader, Vitol is increasingly expanding its traded spot cargo volumes with multi-year LNG deals as a global push for cleaner energy helps the market grow and mature.

According to a statement by Vitol; “the agreement underscores NLNG’s drive…to deliver LNG on a global scale in a low carbon world where gas/LNG will continue to be the preferred complementary energy source alongside renewables”.

The firm at the weekend maintained the deal would assist the NLNG remarket volumes from existing production lines at its Bonny Island plant with a number of contracts due to expire.

It further pointed out that it would purchase volumes from Trains 1, 2 and 3 of a six-train NLNG production facility on Bonny Island under the sales and purchase agreement, signed on December 11, which would expire on October 2021.

“NLNG’s contracts with Turkey’s Botas, Portugal’s Galp Energia, Spain’s Naturgy and France’s energy major Total for a total of 2.67 million tons per year will expire in 2020 and 2021.

Vitol noted that NLNG has over time been looking for buyers for volumes from a yet-to-be-built Train 7.

Vitol, however, added it will purchase volumes on an delivered-ex-ship basis, that would enable NLNG provide shipping for the cargoes.

Even though the price of LNG purchased under the deal has not been disclosed but spot Asian LNG and European gas prices are trading at their lowest level in at least a decade this winter.