NNPCL begins liquefied gas export to Japan, China

NNPCL begins liquefied gas export to Japan, China

The Nigerian National Petroleum Company Limited (NNPC Ltd) has commenced the supply of Liquefied Natural Gas (LNG) to Japan and China on a Delivered Ex-Ship (DES) basis.

The NNPCL said the  milestone was achieved through the collaboration of its downstream subsidiaries, NNPC LNG Ltd and NNPC Shipping Ltd.

The first DES LNG cargo was delivered by the 174,000m³ LNG vessel, Grazyna Gesicka, at the Futtsu terminal in Japan on June 27, 2024, it said in statement.

It said it expanded its reach to China, marking another significant step in its global expansion with the delivery of a DES LNG cargo.

The DES system, a more complex and demanding commercial term compared to the Free on Board (FOB) system, places the responsibility of shipping and insurance squarely on the seller until the goods reach the designated port.

This system requires a high level of expertise and operational efficiency, according to the statement.

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NNPC Ltd’s foray into LNG trading began in November 2021, with the successful sale of its first LNG cargo.

Since then, the company has traded over 20 cargoes, primarily into European and Asian markets on an FOB basis. However, the shift to DES trading marks a pivotal evolution in its strategy, allowing NNPC Ltd to penetrate the downstream segment of the LNG market more effectively.

Executive President of Downstream at NNPC Ltd, Mr Dapo Segun, highlighted the significance of this development.

“The DES system not only offers greater financial rewards but also enables NNPC Ltd to capture more market share while building in-house capacity.

“This ensures that our global customers become well-acquainted with the NNPC Ltd brand, reinforcing our position in the global energy sector,” he stated.

The collaboration between NNPC LNG Ltd and NNPC Shipping Ltd in executing these DES operations has reportedly also strengthened NNPC Shipping’s reputation as a world-class provider in the LNG sector.

The Managing Director of NNPC Shipping, Panos Gliatis, stressed the commitment to expanding the firm’s shipping portfolio, including the acquisition of owned vessels, to offer greater flexibility to both NNPC and other clients.

NNPC LNG Ltd, in collaboration with NNPC Shipping Ltd, is scheduled to deliver at least two additional LNG cargoes to the Asian market on a DES basis by November 2024, with expectations of more orders before the year ends.

NNPCL begins liquefied gas export to Japan, China