E.ON Strikes Three-Year LNG Deal With RasGas

Date : 05/28/2014 @ 8:30AM
Source : Dow Jones News
Stock : Exxon Mobil Corp. (XOM)
Quote : 80.12  0.0 (0.00%) @ 5:32AM

E.ON Strikes Three-Year LNG Deal With RasGas

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FRANKFURT--E.ON SE (EAON.XE) Wednesday said it has agreed on deliveries of liquefied natural gas from Qatar, part of its continued effort to diversify its gas sources and tap an increasingly liquid LNG market.

E.ON said it will source up to around 2 billion cubic meters of LNG from RasGas Company Limited, a joint venture between state-owned Qatar Petroleum and Exxon Mobil Corp. The deliveries will take place over the next three years, E.ON added.

The LNG will be delivered to the regasification terminal on the U.K.'s Isle of Grain, where E.ON has booked capacities, the company said. It didn't disclose financial details of the supply deal.

The agreement with RasGas is E.ON's third LNG deal in about a year and the second with Qatar in just eight months. The deal is part of the company's plan to diversify its gas supply away from its dominant suppliers Russia and Norway.

Russian gas supplies in particular have become controversial in the past few months due to mounting tensions between the West and Moscow over the crisis in Ukraine. Like other European utilities, however, E.ON has repeatedly said it was confident about the reliability of Russian gas supplies. E.ON is one of the largest customers of Russia's natural gas export monopoly Gazprom OAO.

Nevertheless, E.ON has been on the lookout for new gas sources. Last October, it struck an agreement with Qatargas over a five-year supply deal worth up to 10 BCM. The gas will be delivered to the Dutch regasification terminal GATE in Rotterdam.

In June last year, E.ON agreed on a 20-year supply deal with Canada's Pieridae Energy for LNG shipments from the LNG terminal in Goldboro on Canada's east coast, which is planned to be finished in 2020.

Write to Jan Hromadko at jan.hromadko@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires


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