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ExxonMobil Signs 20-Year LNG Agreement With Zhejiang Energy

ExxonMobil signed a sales and purchase agreement with Zhejiang Provincial Energy Group for LNG supply. Zhejiang Energy is expected to receive 1 mtpa over 20 years.

“This sales and purchase agreement represents an important milestone and provides a solid foundation for our strategic partnership with Zhejiang Provincial Energy Group,” said Peter Clarke, senior vice president of LNG at ExxonMobil.

“ExxonMobil shares Zhejiang Energy’s vision in developing a major LNG gateway in the Ningbo-Zhoushan region,” Peter Clarke, ExxonMobil’s senior vice president of LNG, said. “We look forward to continuing our support for Zhejiang Energy during the construction, commissioning and operation of its Wenzhou LNG receiving terminal."

During the signing of the framework agreement in October 2018, ExxonMobil said the deliveries will begin in the early 2020s. The LNG supplies to China would come from a combination of ExxonMobil’s global portfolio as the company boosts output from Papua New Guinea and Mozambique, according to Reuters.

Sinopec and the Zhejiang Energy Group in August 2018 agreed to establish a joint venture company to build an LNG import terminal at Wenzhou in the eastern province of Zhejiang. The facility will have the capacity to handle 3 mtpa of LNG and is set for commissioning toward the end of 2021.

Zhejiang Energy, the province’s largest power producer, will hold a 51% stake in the new entity, Zhejiang Zheneng Wenzhou LNG; Sinopec will hold 41%; and a local investment firm, 8%.

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