THE Nigerian National Petroleum Company Limited (NNPCL) has announced the start of Liquefied Natural Gas (LNG) shipments to Japan and China on a Delivered Ex-Ship (DES) basis.
In a statement released today, the company’s spokesperson, Olufemi Soneye, stated that this achievement was made possible through the collaboration between two of its Downstream subsidiaries—NNPC LNG Ltd and NNPC Shipping Ltd.
They successfully delivered their first DES LNG cargo from the 174,000m³ vessel, Grazyna Gesicka, to Futtsu, Japan, on June 27, 2024.
Following this, NNPCL expanded its operations to China, delivering an additional LNG cargo on a DES basis.
“Delivered Ex-Ship (DES) is an international trade term that obliges the seller to deliver goods to a designated port, with the seller assuming responsibility for shipping and insurance until the goods arrive at the specified destination. This requires a higher level of expertise and efficiency compared to the Free on Board (FOB) system,” Soneye explained.
The spokesperson highlighted that NNPCL has been involved in LNG trading since 2021, with its first sale occurring in November of that year. Since then, the company has traded over 20 cargoes in European and Asian markets on an FOB basis.
NNPC LNG Ltd, in partnership with NNPC Shipping Ltd, plans to deliver at least two more LNG cargoes to the Asian market on a DES basis by November, with additional orders anticipated before the end of the year.
The Executive Vice President of Downstream, Dapo Segun, noted that the DES system is not only more financially rewarding but also provides NNPCL with a strategic entry into the downstream LNG market, enabling it to capture a larger market share, build in-house capacity, and enhance global recognition of the NNPCL brand.
The Managing Director of NNPC Shipping, Panos Gliatis, added that the company intends to develop a shipping portfolio, including owning vessels, to offer its sister company and other clients greater shipping flexibility.
