Shell to Supply Altamira LNG from Nigeria

Anglo-Dutch oil company Shell will supply liquefied natural gas (LNG) for its Altamira regasification terminal in Mexico's Tamaulipas state from Nigeria, Shell Mexico's gas and power manager Cornelis Van der Bom told BNamericas.

However, Shell will have to buy LNG from "other sources" for the first year of the terminal's operations until Nigeria's sixth train starts up in 2007, Van der Bom said on the sidelines of the 14th annual Latin American Energy conference in La Jolla, California.

State power company CFE awarded Shell a contract to supply 5 billion cubic meters a year of regasified LNG for 15 years from October 2006. The initial send-out capacity of the terminal will be 500 million cubic feet a day (Mf3/d). Initial site preparation has been completed and construction of the terminal is slated to start in July this year, Van der Bom said.

In November last year Japanese industrial group Mitsui agreed to acquire a 25% stake in the project, leaving Shell with 50% of the terminal and France's Total with the remaining 25%. All of the terminal's regasification capacity continues to be contracted to a separate marketing company owned by Shell (75%) and Total (25%). Shell also has a 50% stake in US company Sempra Energy's Costa Azul LNG terminal on the Pacific coast of Mexico in Baja California.

Shell has an agreement to buy its share of LNG for the plant, some 500Mf3/d, from Australia's Gorgon project.

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