Gazprom Marketing & Trading Singapore, a wholly-owned trading subsidiary of Russia’s Gazprom Group, and Yamal Trade, a wholly-owned trading subsidiary of Russian gas producer Yamal LNG, have signed a long-term contract for liquefied natural gas (LNG) from the Yamal LNG project to be sold in Asia.
The contract that will be effective for over 20 years provides for the annual supply of 2.9 million tons of LNG that will be delivered to the Asia-Pacific markets, mostly to India. The contract price will be determined using the formula with oil indexation.
Back in May 2014, the companies signed the Heads of Agreement during the St. Petersburg International Economic Forum, which stated that LNG will be supplied under FOB (free on board) terms in a transfer point of Western Europe to be further delivered to Asia-Pacific markets.
The Yamal LNG project envisages the construction of an LNG plant with an annual capacity of 16.5 million tons, with natural gas to be delivered from the Yuzhno-Tambeyskoye field.
The field’s proven and probable gas reserves amount to 927 billion cubic meters. LNG production will start in the end of 2017. The project operator is Yamal LNG, with NOVATEK holding 60 per cent, Total – 20 per cent, and CNPC – 20 per cent in the company.