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April 10, 2006
Osaka Gas Co., Ltd.
Signing of COI for Purchase of LNG from Malaysia
On April 7, 2006 , Osaka Gas signed the Confirmation of Intent (COI) for a purchase of LNG from Malaysia . On the basis of the agreement between Osaka Gas and Malaysia LNG Sdn. Bhd. (MLNG), Osaka Gas plans to purchase LNG for a 15-year period starting April 2009 for an annual maximum volume of 920,000 tons. Upon the signing of COI, the two companies plan to proceed with their negotiations for an execution of a sale and purchase agreement.
The planned purchase will be an addition to the existing two LNG contracts with Malaysia , bringing the total purchase quantity to about 1.6 million tons on an annual basis. The planned new purchase is expected to contribute significantly to a stable supply of LNG to Osaka Gas for the period after 2009.MLNG is a major supplier of LNG based on its natural gas liquefaction plant located in Bintulu, Sarawak, with the maximum production capacity of about 23 million tons annually, supplying LNG mainly to Japan, Korea, and Taiwan.
Overview of COI
Malaysia LNG Sdn. Bhd. is a subsidiary of Petronas, the state-owned oil/natural gas company of Malaysia and is a major supplier of LNG mainly to Japan, Korea, and Taiwan. The company’s equity ownership consists of: Petronas (90%), Sarawak State Government (5%), Mitsubishi Corporation (5%)
About Osaka Gas
Osaka Gas is one of the largest gas utilities in Japan with its headquarters in Osaka, having the customer base of about 6.7 million in the Kansai region. The company purchased the total of about 6.8 million tons of LNG from the following countries (numbers in million tons): Australia (1.04), Brunei (0.83), Indonesia (2.88), Malaysia (0.94), Oman (0.68), Qatar (0.42) in FY2005.