Qatargas has agreed to supply up to 1.1 million tonnes of Liquefied Natural Gas (LNG) per annum to Royal Dutch Shell for five years.

A new Sale and Purchase Agreement (SPA) signed by the parties will come into effect from January 2019.

LNG will be supplied from Qatar Liquefied Gas Company 4 (Qatargas 4) which is a joint venture of Qatar Petroleum and Shell.

In the joint venture, Qatar Petroleum holds 70% stake while Shell holds  30%, which was incorporated in 2007.

Shell Integrated Gas director Maarten Wetselaar said: “Agreements like this support our ability to provide reliable, flexible LNG supply to our customers.

“We strongly believe natural gas has a vital role to play in providing secure and cleaner energy for decades to come."

The LNG is likely to be delivered to the Dragon LNG Terminal located in the UK or the Netherlands-based Gate LNG Terminal.

Qatargas CEO Khalid Bin Khalifa Al-Thani said: “This deal provides Qatargas with access to Shell's gas sales portfolio in the United Kingdom and continental Europe, as well as the flexibility to manage LNG deliveries to our global client portfolio.”

In March, Qatargas entered into an agreement to boost the volume of its currently supplied LNG to PGNiG to two million tonnes per annum (MTPA).

The agreement is slated to come into effect on 1 January 2018 and will expire in June 2034.

Under the deal, the LNG will be delivered to on board Q-Flex LNG vessels to the President Lech Kaczynski LNG Terminal in Swinoujscie, Poland from Qatar Liquefied Gas Company 3 which is a joint venture between Qatar Petroleum, ConocoPhillips, and Mitsui & Co.

Image: Qatargas to deliver 1.1 million tonnes of LNG to Shell under a new agreement. Photo: courtesy of Qatargas Operating Company Limited.