Nigeria's NNPC sends LNG cargoes from Japan to China

NNPC, the state-owned Nigerian company that produces oil and gas, has increased its shipments of liquefied Natural Gas (LNG) to a Chinese port after its initial delivery to Japan in early June.

Nigeria, Africa's top oil producer, has the largest gas reserves on the continent, with more than 200 trillion cubic foot. It has shipped the majority of its LNG via Nigeria LNG, a company in which NNPC holds a 49% share.

NNPC Ltd stated that it has been trading LNG since 2021, with its first LNG cargo sold in November of the same year. Since then, it said that over 20 cargoes have been traded into European and Asian markets under a Free On Board basis. This means the buyer takes on the risk once the seller has shipped the product.

The company now says that it will ship directly from ports to the countries where the cargoes are ordered, bearing all shipping and insurance charges, a practice known in the industry as Delivered Ex-Ship, or DES, which is said to be more profitable.

The DES system is not only more profitable, but also allows NNPC Ltd to gain a foothold in the downstream LNG segment and capture more market shares, all while increasing its own capacity and ensuring global customers know the NNPC Ltd name," said Dapo Segun.

The NNPC has expanded its presence in the LNG market since last year. It signed an agreement for a new floating LNG facility in Nigeria, which will increase exports to Europe.

The NNPC stated that it achieved this feat in collaboration its shipping subsidiary, and that they are scheduled deliver at least two additional LNG cargoes into ports in Asia before November. (Reporting and editing by David Evans; Isaac Anyaogu)

(source: Reuters)