JAKARTA (RambuEnergy) – Petronas through its subsidiary, Malaysia LNG Sdn. Bhd. (MLNG) has signed a Heads of Agreement (HOA) with Tokyo Gas Co. Ltd. to supply liquefied natural gas (LNG) for a period of up to 13 years.
Under the terms of the agreement, the supply to Tokyo Gas commencing in April 2018 will be approximately 0.5 million tonnes per annum for the first six years, with the possibility of a volume increase of up to 0.9 million tonnes per annum for the remaining extension period, Petronas said in a statement.
Petronas Vice President of LNG Marketing & Trading, Ahmad Adly Alias said Petronas remains steadfastly committed to delivering a reliable supply of LNG through its integrated operations that allow for both long-term and short-term solutions for its customers.
“The HOA is a testament to Petronas’ strength and reliability in providing flexible solutions to accommodate the different needs of buyers,” he added.
Tokyo Gas has been procuring LNG from the Malaysia Satu Project since 1983 and kept discussions with Malaysia LNG on the new contract starting April 2018 as the current contract will expire at the end of March 2018. As a result, the parties reached a conclusion of the HoA.
Tokyo Gas and Petronas, through its subsidiary, Malaysia LNG, have established a solid long-standing track record of successful LNG deliveries over a period of 35 years. Both parties further cultivated a mutual trust through a joint study in envisioning the business growth of the parties based on the Memorandum of Collaboration concluded in October 2016.
“At Petronas, we value these relationships and the trust placed in our company for a secure and reliable supply of LNG,” added Ahmad Adly.
MLNG operates the Petronas LNG Complex in Bintulu, Sarawak, one of the world’s largest LNG complexes operating on a single site. The nine-train facility has a combined annual production capacity of about 30 million tonnes.
Key Points of the HoA:
- Seller: Malaysia LNG Sdn. Bhd.
- Buyer : Tokyo Gas Co. Ltd.
- Contract Duration : Up to 13 years from April 2018
- Contract Volume: (First six years) Approximately up to 500,000 tons per annum (remaining 7 years) approx. up to 900,000 tons per annum
- Delivery Terms: DES (delivery ex-shp) and FOB (free on board)