Nigerian National Petroleum Company Limited (NNPCL), on Monday, announced its commencement of shipment of Liquefied Natural Gas (LNG) cargoes to Japan and China, on Delivered Ex-Ship (DES) basis.
The company stated in a statement by its Chief Corporate Communication’s Officer, Olufemi Soneye, it achieved the milestone through the collaboration of two of its downstream subsidiaries, NNPC LNG Ltd. and NNPC Shipping Ltd.
NNPCL disclosed that the two downstream subsidiaries delivered its first DES LNG cargo from the 174,000m³ LNG vessel, Grazyna Gesicka at Futtsu, Japan, on 27 June, 2024.
As contained in the statement, NNPC LNG Ltd., in collaboration with NNPC Shipping Ltd, were scheduled to deliver, at least, two more LNG cargoes to the Asian market on DES basis by November.
This was as the company also disclosed that more orders were expected before the end of year.
“In line with its strategic vision to be a dynamic and reliable global energy supplier of choice, the Nigerian National Petroleum Company Limited (NNPCL) has commenced shipment of Liquefied Natural Gas (LNG) cargoes to Japan and China on Delivered Ex-Ship (DES) basis.
“NNPCL 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 27 June, 2024.
“Since then, it has expanded its footprint to China with the delivery of one LNG cargo on DES basis.
“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.
“NNPCL 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,” it was stated in part in the statement.
Also speaking on the development, the Executive Vice President, Downstream, Mr. Dapo Segun, said NNPC Shipping intends to build a shipping portfolio. He added, “so that we can provide our sister company and other clients all the shipping flexibilities they need.”
“The DES system, apart from being more financially rewarding, allows NNPCL inroads into the downstream segment of the LNG sector.
“The DES positions NNPCL to capture more market shares while building in-house capacity and ensuring that global customers are familiar with the NNPCL brand.
“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.
Managing Director of NNPC Shipping, Panos Gliatis, also said NNPC Shipping aims to develop a shipping portfolio, including owned vessels, to provide greater flexibility to its sister company and other clients.
“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,” he said.
