Oman LNG signs pacts to supply LNG to Shell and OQ Trading

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MUSCAT: Oman LNG has penned two binding term-sheet agreements to supply LNG to Shell International Trading Middle East FZE and to OQ Trading. The signings took place in Muscat yesterday, August 30, in the presence of Eng Salim bin Nasser al Aufi, Minister of Energy and Minerals.

Per the agreement, Oman LNG is expected to supply 0.8 million metric tonnes per annum (mtpa) of liquefied natural gas to Shell International Trading Middle East FZE for 10 years starting from 2025, and 0.75 million metric tonnes per annum (mtpa) for 4 years starting from 2026.

With these latest agreements, Oman LNG has committed to 10.4 mtpa of its output so far this year, covering a total commitment of 80 mtpa over a period of 10 years.

The agreements were signed by the Chief Executive Officer of Oman LNG, Hamed al Naamany, and Senior Vice President and Country Chair Oman Shell, Walid Hadi. Representing OQ Trading was Wail al Jamali, Chief Executive Officer.

Speaking on the signing, CEO of Oman LNG, Hamed al Naamany, shared the following: "The term sheet agreements contribute to global energy security and sustain our position as a trusted supplier of reliable energy, where it facilitates business opportunities, and complements our objectives to establish partnerships and add value to the local economy. Additionally, this Global Marketing Campaign comes as an exceptional milestone in Oman LNG's rather stellar history despite the unprecedented volatile markets due to the geopolitical events and post covid challenges.”

Earlier this year, Shell International Trading Middle East FZE signed a a term sheet for the offtake of 0.8 million ton per annum (mtpa) of LNG from Oman LNG, for a period of ten years starting from 2025, making the corporation the biggest “off-taker from Oman LNG beyond 2024”.

Senior Vice President and Country Chair, Oman Shell, Walid Hadi, shared the following remarks, “Shell is proud of the role it has played in Oman LNG to date, as a shareholder and a technical advisor since its inception. We are proud that we will now become Oman LNG’s largest LNG purchaser as well as its largest private shareholder. This additional off-take term sheet signifies our deep commitment to continue pulling on all levers of Oman’s energy system to address the pressing trilemma of sustainability, affordability, and security. Simultaneously, it serves as a pivotal step in the evolution of our hydrocarbon enterprise, steering it toward a future characterized by both low carbon emissions and financial viability.”

CEO of OQT, Wail al Jamali, added: “As the international energy and commodity trading vehicle of the Government of Oman, we are delighted to add this strategic off-take to our portfolio. The execution of this term sheet represents the first long-term agreement between our two organizations following many years of cooperation. We are committed to developing a strong, sustainable relationships for the long-term benefit of our respective shareholders and the Sultanate of Oman”.

Earlier this month, Oman LNG penned an agreement to supply one million metric tonnes per annum (mtpa) of liquefied natural gas to German firm Secure Energy for Europe (SEFE) in what has been referred to as the first LNG agreement between the two nations.