Exxon Mobil Corporation announced today that Ras Laffan Liquefied Natural Gas Company Limited (RasGas), a joint venture between Qatar Petroleum (70 percent) and ExxonMobil (30 percent), has concluded the first phase of the world's largest LNG Sale and Purchase Agreement (SPA) with Petronet Ltd. of India.
The conclusion of the negotiations triggers a period of major gas expansion in Qatar, beginning with the construction of additional offshore production facilities in the North Field and the building of the world's largest and most cost efficient LNG train at Ras Laffan Industrial City.
Petronet is a Joint Venture between the Indian Oil Corporation, Bharat Petroleum Corporation, the Gas Authority of India Ltd and The Oil and Natural Gas Corporation. The SPA covers the supply of LNG for 25 years. Deliveries of 5.0 million metric tons per year (MMTA) will be made to a new import terminal at Dahej, Gujarat State, while plans for a further 2.5 MMTA to a second import terminal at Cochin, Kerala State, are under development.
Construction of the Dahej terminal began earlier this year and deliveries are slated to begin upon completion of the terminal in late 2003.
Stuart McGill, president of ExxonMobil Gas Marketing Company, said: "This represents the culmination of a lot of hard work, commitment and dedication by Petronet and its Shareholders, the Indian Government, the State of Qatar and ExxonMobil. As the largest LNG contract ever signed, it is a milestone for the Industry. We are proud to be part of such a historic and important agreement. It will provide a competitive new gas supply to support the impressive growth in India's economy and opens an important new market for Qatar's LNG."
The final Conditions Precedent for the SPA, which were met over the previous week in Doha and New Delhi, enabled RasGas to sign two world-scale Engineering, Procurement and Construction (EPC) contracts. The first, with a joint venture consisting of Chiyoda Corporation, Mitsui Co. Ltd. and Snamprogetti S.P.A., is to build a record 4.7 MMTA LNG liquefaction train. The second contract, with J. Ray McDermott Middle East (Indian Ocean) Limited, covers the offshore and gathering facilities that will produce 800 million standard cubic feet per day of natural gas to supply the new LNG train along with some 30,000 barrels per day of associated condensate. With this first phase of onshore and offshore development, ExxonMobil expects to book more than 350 million net oil equivalent barrels of proved reserves.
