The Nigerian National Petroleum Company Limited (NNPC Ltd) has said that it has commenced shipment of Liquefied Natural Gas (LNG) cargoes to Japan and China on Delivered Ex-Ship (DES) basis.
The Chief Corporate Communications Officer, NNPC Ltd, Olufemi Soneye, in a statement issued on Monday explained that the development was in line with its strategic vision to be a dynamic and reliable global energy supplier of choice.
Soneye revealed that NNPC Ltd. achieved the milestone through the collaboration of two of its Downstream subsidiaries – NNPC LNG Ltd. and NNPC Shipping Ltd. – which delivered its first DES LNG cargo from the 174,000m³ LNG vessel, Grazyna Gesicka at Futtsu, Japan, on 27th June 2024.
He added that since then, it has expanded its footprint to China with the delivery of one LNG cargo on DES basis.
He said: “Delivered Ex-Ship (DES) is an international commercial term that requires the seller to deliver the products/goods at a specific port.
“The seller takes responsibility for the shipping and insurance for the products/goods until they get to the specified port of delivery. It requires expertise and a higher level of efficiency to execute than the Free on Board (FOB) system.
“NNPC Ltd. has been involved in LNG trading since 2021 with its first LNG cargo sale in November of that year. It has since traded over 20 cargoes into the European and Asian markets on FOB basis.”
Speaking on the development, the Executive Vice President, Downstream, Mr. Dapo Segun, said: “The DES system, apart from being more financially rewarding, allows NNPC Ltd. inroads into the downstream segment of the LNG sector and positions it to capture more market shares while building in-house capacity and ensuring that global customers are familiar with the NNPC Ltd. brand”.
Soneye further said the collaboration between NNPC LNG Ltd. and NNPC Shipping Ltd. in executing the LNG supplies on DES basis has strengthened the latter’s position as a world class shipping provider in the LNG sector.
The Managing Director of NNPC Shipping, Panos Gliatis, said: “NNPC Shipping intends to build a shipping portfolio (including owned vessels) so that we can provide our sister company and other clients all the shipping flexibilities they need.”
“NNPC LNG Ltd., in collaboration with NNPC Shipping Ltd, is scheduled to deliver at least two more LNG cargoes to the Asian market on DES basis by November. More orders are expected before the end of year,” Soneye said.
