MOSCOW (MRC) -- Tokyo Electric Power Company (Tepco) and BP Singapore (BPS) have reported the conclusion of a sale and purchase agreement for LNG. Under the agreement, Tepco will purchase up to 1.20 MMtpa of LNG over 17 years from BPS, starting in April 2017, said Hydrocarbonprocessing.
The agreement states that Tepco will receive LNG from BPS, supplied from multiple LNG sources which BP Group holds, and is the first long term contract of its kind for Tepco.
The agreement will enable Tepco's steady purchase of LNG through diversification, since BPS will provide LNG from various supply areas. The supply features the inclusion of lean LNG, of which Tepco intends to increase its share, and also the inclusion of gas link (Henry Hub link) for price indexation, which will contribute to Tepco's aim of purchasing LNG at competitive price.
Tepco has reviewed multiple supply sources, including those of US origin, in its strategy towards the annual purchase of approximately 10 MMtpa of lean LNG (half the amount of LNG purchasing). With this agreement concluded with BPS, a total of approximately 2 MMtpa of lean LNG will be secured.
In addition to introducing multiple supply sources and diversification of price indexation, Tepco will continue to strive towards the steady and economical purchase of fuel through comprehensive business alliances in order to meet its responsibilities as an electricity supplying company.
As MRC wrote before, BP, the UK oil company with the single-biggest foreign investment in Russia, warned that more sanctions against the country could hurt its business. BP, with a 20% stake in OAO Rosneft, stands to lose the most from further sanctions in response to Russia’s annexation of Crimea. The European Union and the US are acting to intensify punitive measures aimed at key sectors of the economy -- finance, defense and energy.
BP is one of the world's leading international oil and gas companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items.
MRC