US oil and natural gas exploration and production company Anadarko Petroleum has signed two Sale and Purchase Agreements (SPAs) for the long-term supply of liquid natural gas (LNG) to Tokyo Gas and Centrica, and to Shell.
In the first of the agreements, energy providers Centrica and Tokyo Gas have agreed to buy 2.6 million tonnes per annum (MTPA) of LNG, from the start-up of production from Mozambique Area 1 until the early 2040s.
Anadarko operates Area 1 with a 26.5% working interest through its subsidiary Anadarko Mozambique Area 1. The SPAs were signed with Mozambique LNG1 Company, the jointly-owned sales entity of the Mozambique Area 1 co-venturers.
Mozambique’s first onshore LNG plant
Anadarko is developing Mozambique’s first onshore LNG plant to support the development of the Golfinho/Atum field in Area 1 (first discovered by Anadarko in June 2012), and the agreement will provide the project with key foundation customers to support the investment.
Anadarko vice president Mitch Ingram said: “This innovative co-purchasing agreement with Tokyo Gas and Centrica will ensure a reliable supply of clean-burning natural gas to help meet the energy demands of Japan and Europe. It signals the beginning of a new and lasting relationship between Mozambique’s first onshore LNG development and these two prominent and respected foundation customers.”
“With the vast resources we have discovered in Area 1 and our capability to compete in global LNG markets, Mozambique LNG is poised to become a key LNG supplier for decades to come. We are excited to support the Japanese Government’s desire for competitively-priced and flexible long-term supply of LNG to proactively manage demand fluctuations in their home markets and enhance the nation’s energy security.”
Shell agreement to buy 2 MTPA of LNG from Area 1
In a separate announcement, Anadarko stated that Shell has agreed to buy 2 MTPA of LNG from Area 1 for a term of 13 years.
Ingram said: “We are very pleased to announce this SPA with Shell, which builds upon previously announced deals and takes our total long-term sales to more than 7.5 MTPA, with additional deals expected in the near future.”
“With demand for LNG expected to grow worldwide in the middle of the next decade, Shell’s strong global reputation in LNG, combined with Mozambique LNG’s significant resource and favourable geographic location, create a unique opportunity to provide customers with a long-term, reliable supply of clean energy.”