Spain: IBERDROLA Inks LNG Supply Deal With BP

IBERDROLA has signed a contract with BP whereby the Spanish company will supply 0.5 bcm (billion cubic metres) of liquefied natural gas (LNG) in Spain starting 2012.

The 10-year agreement, which envisages annual deliveries to BP amounting to six LNG cargoes at Spanish regasification terminals, enables IBERDROLA to further expand its gas supply options in view of falling demand in Spain. IBERDROLA will deliver gas to BP from its long-term volume portfolio, having signed supply contracts with companies including Italy’s ENI, Sonatrach, Nigeria LNG and Statoil.

This diversified and flexible gas portfolio enabled IBERDROLA last year to sign another important supply contract with Danish company Dong, to which it will deliver 1 bcm/year of LNG at the Rotterdam regasification plant from the second half of 2010 for at least 10 years.

BP, which is active in both upstream and downstream gas activities, seeks to optimize its global LNG supply chain, using volumes received from IBERDROLA in Spain to replace current imports and divert the gas to other countries.

BP has been distributing natural gas through its Spanish affiliate, since the business was first deregulated, and maintains a significant position in the industrial market.

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Source: IBERDOLA, June 1, 2011;