Centrica and Tokyo Gas have signed an agreement to jointly buy 2.6 million mt/year of LNG from Mozambique LNG, UK-based Centrica said on Tuesday. The move follows a non-binding deal signed in June 2018, and marks an important step towards the final investment decision by the Mozambique Area 1 joint venture partners, expected for the first half of 2019.
The LNG will be delivered ex-ship (DES) to either Europe or Asia, from the start-up of production until early 2040.
With the deal, the companies want to take advantage of Mozambique’s central location between Europe and Asia, whose gas markets have different supply and demand fundamentals. The agreement also represents the first long-term LNG procurement contract in Africa for both Tokyo Gas and Centrica, which is in line with their plan to diversify their respective supply portfolios.
The deal will improve liquidity and further develop the global LNG market, Centrica said. Mozambique LNG is a planned two-train 12.9 million mt/year project. Partners in the project include Anadarko (26.5%), Mitsui (20%), and with lower stakes, ONGC Videsh, Empresa Nacional de Hidrocarbonetos (ENH), Bharat PetroResources , PTT Exploration & Production and Oil India. Last week, Anadarko Petroleum agreed to sell 1.5 million mt/year from Mozambique LNG to China’s CNOOC for a period of 13 years.Share This