State-owned producer Oman LNG has signed a long-term liquefied natural gas supply deal with its shareholder Shell.
Under the term sheet, Oman LNG said it would supply 0.8 million metric tonnes per year for a period of 10 years to a unit of Shell.
The LNG supplies to Shell would start in 2025.
“The agreement represents a crucial milestone in Oman LNG’s history and complements our beyond 2024 efforts,” Oman LNG said.
Shell has been a shareholder in Oman LNG with a 30 percent stake since its inception while the government of Oman holds 51 percent in the LNG producer.
According to a LinkedIn post by Walid Hadi, Shell’s head in Oman, this marks Shell’s first long-term offtake deal with Oman LNG.
Besides the LNG supply deal, Hadi also said that Shell had joined the Green Energy Oman (GEO) consortium and had signed a letter of intent with Oman’s Ministry of Energy and Minerals to explore the deployment of liquefied synthetic gas in Oman.
Fourth deal for Oman LNG
In December, Oman LNG signed key term sheets to supply liquefied natural gas to Japan’s Jera, Mitsui, and Itochu.
The yearly supplies for the three firms total 2.35 mtpa of LNG and would start in 2025 as well.
Prior to these deals, Oman LNG loaded the 3000th cargo in November at its complex in Qalhat, Sur since 2000.
The state-owned firm operates three LNG trains in Qalhat with a nameplate capacity of 10.4 mtpa sourcing gas from the central Oman gas field complex.
Moreover, it mostly supplies LNG under long-term deals with Kogas, BP, Itochu, Osaka Gas, and Naturgy.
Oman’s LNG exports rose 8 percent in the first half of 2022 to 91 cargoes due to debottlenecking. The firm delivered in total 163 cargoes or 10.6 mtpa of LNG in 2021.
The company’s complex now has a production capacity of around 11.4 mtpa.
