The Nigeria National Petroleum Corporation (NNPC) Limited has commenced the export of Liquefied Natural Gas (LNG) to the Asian markets of China and Japan. This was disclosed by the NNPC spokesperson, Olufemi Soneye, in a statement released on Monday in Abuja, marking a significant step in the company’s global energy supply strategy.
Soneye explained that the LNG shipments to these Asian countries were conducted on a Delivered Ex-Ship (DES) basis, a commercial term where the seller assumes responsibility for shipping and insurance until the goods reach the specified port of delivery. The first DES LNG cargo was delivered from the 174,000m³ LNG vessel, Grazyna Gesicka, at Futtsu, Japan, on June 27, 2024, followed by another delivery to China.
NNPC’s venture into the Asian markets aligns with its strategic vision to become a dynamic and reliable global energy supplier of choice. The success of these shipments was attributed to the collaboration between two of its Downstream subsidiaries – NNPC LNG Ltd. and NNPC Shipping Ltd. This partnership has enabled NNPC Ltd. to expand its LNG footprint and strengthen its market position.
Soneye also revealed that NNPC has been actively involved in LNG trading since 2021, with its first LNG cargo sale occurring in November of that year. Since then, the company has traded over 20 cargoes into European and Asian markets, primarily on a Free on Board (FOB) basis. The shift to DES operations is seen as a strategic move to capture more market share and enhance financial returns.
Dapo Segun, Executive Vice President of Downstream, highlighted the advantages of the DES system, stating that it not only offers better financial rewards but also positions NNPC Ltd. to build in-house capacity and increase brand recognition globally. This approach is expected to solidify NNPC’s presence in the downstream segment of the LNG sector.
The Managing Director of NNPC Shipping, Panos Gliatis, echoed these sentiments, noting that the collaboration between NNPC LNG Ltd. and NNPC Shipping Ltd. has reinforced NNPC Shipping’s status as a world-class provider in the LNG sector. He added that NNPC Shipping is working on expanding its portfolio, including acquiring owned vessels, to offer greater flexibility to its sister companies and other clients.
This development comes as Nigeria continues its strategic shift from oil to gas, leveraging its vast gas reserves, which surpass its crude oil reserves. President Tinubu’s administration has further accelerated this transition, with new executive orders aimed at bolstering the gas industry and increasing production capacity through the inauguration of new gas plants and significant partnerships.
In line with this vision, NNPC has entered into a Project Development Agreement (PDA) with North American firm Golar LNG to establish offshore LNG production in the Niger Delta. This project aims to harness 400-500 million standard cubic feet per day (mmscf/d) of gas, producing LNG, Liquefied Petroleum Gas (LPG), and condensate within Nigeria, further solidifying the country’s position in the global energy market.