Repsol Signs LNG Sales Agreement with Shell

Repsol YPF has entered into an agreement to sell Shell Western LNG Ltd 2 billion cubic meters (bcm) of natural gas in the form of LNG (liquefied natural gas) from Trinidad & Tobago through December 2005. The LNG will be delivered to the Cove Point LNG regasification terminal on the eastern coast of the United States.

The contractual amount is Repsol YPF’s largest transaction to date in the U.S. market. The gas will come from trains 2 and 3 at Atlantic LNG in which Repsol YPF has a 25% stake. This new agreement is in addition to the previous sales to Statoil, BG, and BP.

Gas from Trinidad & Tobago meets the quality specifications for all the LNG plants on the U.S. eastern seaboard. Repsol YPF is well poised to take advantage of the price opportunities in the American region and can cover Spanish demand with other sources thereby obtaining additional cost savings in transport.

For Repsol YPF, the Trinidad & Tobago project is particularly significant within the framework strategy of profitable growth in LNG activities based on integrated chains. Repsol YPF has a 20% stake in the company that owns train 1 (Atlantic LNG) and a 25% stake in the joint venture with BP, BG and others that owns trains 2 and 3 (Atlantic LNG 2/3) created to operate natural gas facilities in Trinidad & Tobago. Most of the natural gas (75%) for the different trains comes from BP Trinidad & Tobago’s offshore fields, a company in which Repsol YPF has a 30% working interest. Repsol YPF will have an approximate 22.2% stake in the fourth train that was recently approved by the Government of the Republic of Trinidad & Tobago and expected to start operations at the end of 2005.

Repsol YPF currently sells 2.7 bcm of LNG in the U.S. and Caribbean area.

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