PNG, Sinopec ink 20-yr supply deal

mlipen Business, Main Stories

PAPUA New Guinea will supply liquefied natural gas (LNG) to Sinopec’s LNG terminal in Shandong province, China, for a period of 20 years.
This is under a binding sales and purchase agreement for the long-term sale and purchase of LNG totalling about two million tonnes per year.
Unipec Asia Co Ltd, a subsidiary of China Petroleum & Chemical Corp (Sinopec) and Esso Highlands Ltd, a subsidiary of ExxonMobil Corp and operator of the PNG LNG project, yesterday announced that Sinopec and the project participants have entered into the agreement.
 “We are pleased that the project has completed this important agreement with a key Asian LNG customer and look forward to a long and mutually beneficial relationship between Sinopec and the project,” Ron Billings, vice-president LNG, ExxonMobil Gas & Power Marketing Co, said.
 “This is a key milestone in the project’s schedule.
“Sinopec is very pleased to reach the final sales and purchase agreement with the PNG LNG project.
“The LNG we have committed will supply an LNG terminal that Sinopec is going to build in Qingdao, Shandong province.
 “Phase one capacity of the terminal is three million tonnes per annum …  with the developments of the market, we will expand the facilities to receive five to six million tonnes per year in a phase two stage.
“This LNG terminal will provide long-term and reliable clean natural gas resources to the Shandong market and will play a positive role in meeting the local demand, optimising the energy mix and improving the local environment,” Wang Zhigang, senior vice-president of Sinopec Corp, said.
Sinopec is listed in Hong Kong, New York, London and Shanghai, and it is also a fully-integrated energy and chemical company.
The PNG LNG project, an integrated development which includes gas production and processing facilities, onshore pipelines and offshore pipelines and LNG plant facilities.
Participating interests are ExxonMobil (through various affiliates, including Esso Highlands Ltd as operator) 41.5%, Oil Search 34.0%, Santos 17.7%, Nippon Oil 5.4%, Mineral Resources Development Co 1.2%, and Petromin PNG Holdings Ltd 0.2%.
(Participation will change when the PNG State nominees join as equity participants at a later date).