Novatek announced the conclusion of heads of agreement for the supply of liquefied natural gas (LNG) between Yamal LNG and China National Petroleum Corporation (CNPC).
The document provides for the supply of no less than three million tons of LNG per annum at delivered ex-ship (DES) terms for a period of 15 years with possible supply extension, with the LNG price is indexed to the Japanese Crude Cocktail.
Chairman of the Management Board of Novatek, Leonid V. Mikhelson stated “We welcome the achievement of a mutually beneficial agreement on LNG supplies to the fast growing Chinese market”.
Yamal LNG is a joint venture currently owned by OAO NOVATEK (80%) and Total S.A. (20%). On 5 September NOVATEK and CNPC concluded an agreement on purchase of a 20% equity share in Yamal LNG by CNPC.
The transfer of title to the equity share is subject to receipt of necessary regulatory approvals and expected to be completed by December.
LNG World News Staff, October 22, 2013