Nigerian National Petroleum Company Limited (NNPC Ltd.) has started shipping liquefied natural gas (LNG) cargoes to Japan and China on a delivered-ex-shipment (DES) basis.
Mr Olufemi Soneye, Chief Corporate Communications Officer, NNPC Ltd., quoted Mr Segun Dapo, Executive President, Downstream, NNPC Ltd., in a statement issued in Abuja on Monday.
Dapo was reported as noting that the development was consistent with the company’s strategic aim of being a dependable global energy supplier. “Apart from being more financially rewarding, the DES system allowed NNPC Ltd. to inroad into the downstream segment of the LNG sector,” he said.
The News Agency reports that Delivered Ex-Ship (DES) is an international commercial term that requires the seller to deliver the products/goods at a specific port.
The seller is responsible for the shipping and insurance of the products and goods until they reach the stated port of delivery. Execution demands more knowledge and efficiency than the Free on Board (FOB) approach.
Soneye further reported Dapo as saying that NNPC Ltd. reached the milestone in partnership with two downstream businesses.
He listed two subsidiaries: NNPC LNG Ltd and NNPC Shipping Ltd. The first DES LNG cargo was delivered on June 27, 2024, from the 174,000-m³ LNG tanker Grazyna Gesicka in Futtsu, Japan.
“Since then, it has expanded its footprint to China with the delivery of one LNG cargo on DES basis.
“NNPC Ltd. has been involved in LNG trading since 2021, with its first LNG cargo sale in November of that year. It has since traded over 20 cargoes into the European and Asian markets on FOB basis.
“It will position NNPC Ltd. to capture more market shares while building in-house capacity and ensuring that global customers are familiar with the NNPC Ltd brand,” he said.
According to Dapo, the collaboration between NNPC LNG Ltd. and NNPC Shipping Ltd. in executing the LNG supplies on DES basis has strengthened the latter’s position as a world-class shipping provider in the LNG sector.
The Managing Director of NNPC Shipping, Mr Panos Gliatis, was also quoted as saying that NNPC Shipping intended to build a shipping portfolio (including owned vessels) to provide the sister company and other clients all the shipping flexibilities they needed.
NNPC LNG Ltd., in collaboration with NNPC Shipping Ltd., is scheduled to deliver at least two more LNG cargoes to the Asian market on DES basis by November. More orders are expected before the end of year.
