Abu Dhabi: UAE’s ADNOC announced Tuesday it had signed a long-term head of agreement (LNG Agreement) with Osaka Gas. One of the largest utility companies in Japan, the companies have struck a deal to deliver up to 0.8 million metric tonnes per annum (mmtpa) of liquefied natural gas (LNG).
The LNG will primarily be sourced from ADNOC’s lower-carbon Ruwais LNG project, currently under development in Al Ruwais Industrial City, Abu Dhabi, and is expected to start commercial operations in 2028.
Under the agreement, LNG cargoes will be shipped to the destination ports of Osaka Gas and its Singapore-based subsidiary, Osaka Gas Energy Supply and Trading Pte. Ltd. (OGEST). ADNOC and Osaka Gas will work together to conclude a detailed Sale and Purchase Agreement in the coming months based on the terms of the LNG agreement, the companies said in a statement.
Rashid Khalfan Al Mazrouei, ADNOC Senior Vice President of Marketing, said, “This landmark LNG agreement, our first long-term LNG deal with Osaka Gas, underscores the strong, long-standing energy partnership between the UAE and Japan.”
Al Mazrouei said, “This agreement further enhances ADNOC’s position as a reliable and responsible global energy provider and reflects our commitment to help meet Japan’s energy needs with secure and sustainable energy solutions. The Ruwais LNG project supports our broader strategy to expand our global LNG footprint to enable the energy transition.”
In June 2024, ADNOC took the Final Investment Decision (FID) for the Ruwais LNG project and awarded the $5.5 billion (Dh20.2 billion) engineering, procurement and construction (EPC) contract. The agreement with Osaka Gas is one of several long-term LNG sales commitments ADNOC has signed with international partners for Ruwais LNG, which take the long-term sales commitments to 70 per cent of the project’s total production capacity.
In July 2024, ADNOC signed long-term LNG agreements for the delivery of 1mmtpa with Shell and 0.6mmtpa with Mitsui & Co. Previously, LNG agreements were signed with Germany’s EnBW for 0.6mmtpa, with China’s ENN for at least 1mmtpa and with Germany’s SEFE for 1mmtpa.
Keiji Takemori, Osaka Gas Executive Vice President, said, “This agreement will significantly enhance the stability of Osaka Gas’ LNG procurement. It will also strengthen the foundation of our stable energy supply to customers, transition to lower carbon energy, and acceleration towards our net zero target.”
Takemori said, “We will continue working on the stable procurement, development and supply of natural gas as a key transition fuel.”
Moreover, the Ruwais LNG plant is set to be the first LNG export facility in the Middle East and Africa region to run on clean power, making it one of the world's lowest carbon-intensity LNG plants. The facility will leverage artificial intelligence and the latest technologies to enhance safety, minimize emissions and drive efficiency.
The Ruwais LNG project will consist of two 4.8mmtpa LNG liquefaction trains with a total capacity of 9.6mmtpa. This will more than double ADNOC’s existing UAE LNG production capacity to around 15mmtpa as the company builds its international LNG portfolio.
