Oman LNG and Shell sign five year gas deal

This agreement is Oman LNG's fourth medium/long term SPA, the others comprising 4.1 mtpa to Kogas, 0.7 mtpa to Osaka Gas (both 25 years) and Dabhol Power (20 years).

Signing of the SPA took place under the patronage of His Excellency Salim bin Mohammed bin Shaban, Under-Secretary at the Ministry of Oil & Gas and Chairman of Oman LNG, at the Ministry of Oil & Gas. The agreement was signed by Dr Agnus Cassens, Oman LNG General Manager and Chief Executive and John Crocker, General Manager of Shell Representative Office in Oman.
Mr Crocker said: "The agreement is significant as it is the first five-year deal that Shell has purchased. Beginning this year, the LNG will be delivered to Spain by Shell-owned LNG carriers, which Oman LNG has an option to replace with its own ship from 2004 onwards."

Dr Cassens explained that: "Originally our customers had been supplying their own ships for these long-term contracts - KOGAS, Osaka and Dabhol being good examples - while we found an increasing need to secure some shipping capacity ourselves. This also follows the aspiration of the Government of Oman considering to build its own fleet of LNG ships to be provided to OLNG.

"The sale of all the LNG coupled with the rapid development of the project makes Oman LNG one of the most successful gas ventures undertaken in recent years. This success is a tribute to the Government's commitment, and its ability to create the kind of climate needed to make a huge undertaking like this succeeds. It is also due in no small part to the partnership that has developed between the Government and the Company's private shareholders," said Dr. Cassens.