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BP and CNOOC sign massive LNG supply deal

18th June 2014

BP and the China National Offshore Oil Corporation (CNOOC) have announced a heads of agreement for the supply of up to 1.5 million tonnes of liquefied natural gas (LNG) per year over 20 years starting in 2019, in an agreement amounting to approximately USD 20bn

BP and CNOOC sign massive LNG supply deal
The agreement was signed in London yesterday by BP executive vice president, Dev Sanyal and CNOOC chairman, Wang Yilin

“This is a significant deal for BP and China but it also marks a step up in global connectivity in the gas market,” said Bob Dudley, BP Group chief executive. “This is important for all countries and regions looking at the diversity of energy supply and energy security - it gives BP greater flexibility to respond to the changing energy demands from Europe, Asia and other regions.”

The agreement was signed in London yesterday by BP executive vice president, Dev Sanyal and CNOOC chairman, Wang Yilin, in the presence of UK prime minister David Cameron and Chinese premier, Li Keqiang.

“We are pleased to support China’s commitment to improving its air quality. This agreement is the first long-term LNG supply deal wih China where BP is the sole supplier and it should play a crucial role in enhancing China’s energy diversification and supporting its economic growth.”

A full commercial contract is expected to be agreed in mid-2014. BP would expect to supply LNG from its global portfolio, using its own LNG tanker fleet and chartered ships delivering gas to a number of terminals in China.

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