Chevron Corporation announced it has signed a key terms agreement with Singapore Carbon Hydrogen Energy Pte. Ltd., a subsidiary of JOVO, for the delivery of liquefied natural gas (LNG) from the company’s global supply portfolio.
As soon as the LNG Sale and Purchase Agreement is finalised, JOVO is expected to receive up to 0.5 million tonnes of LNG per year over a duration of five years.
“This agreement is another important step in the commercialisation of Chevron’s natural gas holdings”, said Mike Wirth, executive vice president of Chevron Midstream and Development.
Chevron Signs LNG Supply Agreement
The first delivery is expected to arrive in 2018, the company informed in a statement.
With this agreement, Chevron expects to substantially reinforce its position in the global LNG market.
“We are positioned to become one of the top 10 LNG suppliers in the world,” Wirth stated further.
JOVO is a privately-owned Chinese energy company, with an LNG business portfolio that includes an LNG receiving terminal, tank truck operations, and urban pipelines for natural gas.
As well as this, the company offers automobile gas refilling stations, direct industrial clients, power plant customers and exclusive management of an industrial park in South China.
Chevron Strives In a Challenging Period
In its report for the first quarter of the year, the company mentioned a difficult period for the market and the firm.
“Low oil and natural gas prices made 2015 a challenging year for Chevron and the oil and gas industry,” Chevron Chairman of the Board and Chief Executive Officer, John Watson, said at the time.
“Chevron is taking significant actions to ensure we are well placed to emerge from this challenging operating environment in a position of strength,” he added.
The executive also reiterated the company’s focus on completing major projects under construction, thus enabling a cut in spending and an increase in production, which should in its turn improve free cash flow.
Chevron is also selectively growing in the lower price environment, the company added.