The global presence of the Nigerian National Petroleum Company Limited has been expanded through the initiation of Liquefied Natural Gas shipments to Japan and China.
These shipments, conducted on a Delivered Ex-Ship basis, signify a significant milestone for the company as it ventures deeper into the global energy market.
Addressing this achievement in a statement released on Monday, Olufemi Soneye, the NNPC Chief Corporate Communications Officer, emphasized the complexity and expertise required to execute DES transactions.
Soneye explained, “Delivered Ex-Ship (DES) is an international commercial term that necessitates the seller to deliver the products/goods at a specific port. The seller assumes responsibility for the shipping and insurance of the products/goods until they reach the designated port of delivery. It demands expertise and a higher level of efficiency to execute compared to the Free on Board (FOB) system.”
The inaugural successful DES LNG cargo delivery by NNPC Ltd occurred on June 27, 2024, with the 174,000m³ LNG vessel Grazyna Gesicka arriving at Futtsu, Japan.
This accomplishment was made possible through the collaborative efforts of two of NNPC’s downstream subsidiaries, NNPC LNG Ltd and NNPC Shipping Ltd. Subsequent to this success, NNPC Ltd broadened its operations to China, delivering another LNG cargo on a DES basis.
Highlighting the company’s increasing influence in the international LNG market, Soneye added, “NNPC Ltd has been actively engaged in LNG trading since 2021, commencing with its inaugural LNG cargo sale in November of that year. It has since traded over 20 cargoes in the European and Asian markets on an FOB basis.”
Emphasizing the financial and strategic benefits of the DES system, Dapo Segun, the Executive President of NNPC Ltd’s Downstream Division, stated, “The DES system, in addition to being more financially rewarding, provides NNPC Ltd with an entry into the downstream segment of the LNG sector and positions it to capture more market share while enhancing in-house capabilities and ensuring global customers are acquainted with the NNPC Ltd brand.”
The collaboration between NNPC LNG Ltd and NNPC Shipping Ltd has not only bolstered NNPC’s position in the LNG sector but has also strengthened NNPC Shipping Limited’s reputation as a top-tier shipping provider.
Expressing optimism for the company’s future, Panos Gliatis, the Managing Director of NNPC Shipping Ltd, stated, “NNPC Shipping aims to establish a shipping portfolio (comprising of owned vessels) to cater to the shipping needs of our sister company and other clients efficiently.”
Looking ahead, Gliatis disclosed that NNPC LNG Ltd, in conjunction with NNPC Shipping Ltd, is slated to deliver at least two additional LNG cargoes to the Asian market on a DES basis by November 2024, with expectations for multiple additional orders before the year concludes.