Novatek, CNPC Conclude Yamal LNG Deal

Novatek and China National Petroleum Corporation (CNPC) on Tuesday concluded the Heads of Agreement for the supply of liquefied natural gas (LNG) between Yamal LNG and the Chinese energy firm.

As per the agreement, CNPC will get a supply of no less than three million tons of LNG per annum for a period of 15 years with possible supply extension, with the LNG price indexed to the Japanese Crude Cocktail.

Yamal LNG project will have an annual capacity of 16.5 million tons per annum based on the feedstock resources of the South-Tambeyskoye field.

The proven and probable reserves of the South-Tambeyskoye field as of 31 December 2012 were appraised at 907 billion cubic meters of natural gas.

The project is a joint venture currently owned by Novatek (80%) and Total (20%).

In September Novatek and CNPC concluded an agreement on purchase of a 20% equity share in Yamal LNG by CNPC.

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