BRUNEI TO SHIP MORE LNG TO JAPAN
Brunei Coldgas Sdn. Bhd. won renewal of an LNG supply contract with three Japanese utilities and will ship 5.5 million metric tons/year of LNG for 20 years effective Apr. 1.
Tokyo Electric Power Co. Inc., Tokyo Gas Co. Ltd., and Osaka Gas Co. Ltd. received about 5 million metric tons/year of LNG in a 20 year deal with Brunei Coldgas that expired Mar. 31.
Last year Brunei Coldgas, responsible for all sales of LNG produced in Brunei, began talks to renew the contract (OGJ, Apr. 5, Newsletter). The companies signed a letter of agreement Mar. 31 and expect to sign a detailed contract by the end of June.
Coldgas' shareholders are the Brunei government 50%, operator Shell Overseas Trading Ltd. 25%, and Mitsubishi Corp. 25%.
Shell said LNG facilities in Brunei underwent several hundred million dollars in rejuvenation to prepare for project extension. This included replacement of cryogenic tanks and current construction of a jetty.
Shell Tankers (U.K.) Ltd. will continue to provide transport using seven LNG tankers owned by Brunei Shell Tankers Sdn. Bhd. The fleet is made up of five 51,500 dwt ships and two 41,300 dwt vessels.
The ships are 20 years old but recently passed inspection with a view to 20 more years of use. Shell said ships will be replaced if the need arises.
The Japanese LNG market is estimated by Shell at 45 million metric tons/year and due to double in size in the next 20 years. Market value is pegged at $10 billion/year.
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