The Nigerian state-owned oil company NNPC has increased its shipments of liquefied natural gas (LNG) cargoes to a Chinese port following its initial delivery to Japan in June.
Nigeria, the largest oil producer in Africa, has over 200 trillion cubic feet of gas reserves and has traditionally exported most of its LNG through Nigeria LNG, in which NNPC holds a 49% stake.
NNPC Ltd announced its involvement in LNG trading in 2021, making its first LNG cargo sale in November of the same year. It has traded over 20 cargoes to the European and Asian markets on Free on-Board basis, where the buyer assumes risks upon the seller shipping the product.
The company plans to ship directly to the cargo-ordered countries, covering shipping and insurance costs. This system, known in the industry as Delivered Ex-Ship (DES), is deemed to be more profitable by the company.
Dapo Segun, executive president of NNPC Downstream, emphasised that the DES system is not only more financially rewarding but also allows NNPC Ltd to expand into the downstream segment of the LNG sector, gain more market share, build in-house capacity, and enhance global customer familiarity with the NNPC Ltd brand.
Over the past year, NNPC has been extending its presence in the LNG market and has secured an agreement to construct a new floating LNG plant in Nigeria to increase exports to Europe.
The NNPC has accomplished this in cooperation with its shipping subsidiary, which is set to deliver at least two more LNG cargoes to Asian ports by November.