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Asian breakthrough with LPG

January 23, 2003, 14:45 CET

Long-term contracts worth about NOK 1.5 billion which Statoil has concluded in Japan and China mark a breakthrough for the group’s sales of liquefied petroleum gases to Asia.

A total of 600,000 tonnes of LPG have been sold under three deals, including 400,000 tonnes for Japanese industrial group Mitsui.

A further 100,000 tonnes is being taken by Japan’s Marubeni, while ChevronTexaco subsidiary Caltex is buying 100,000 tonnes for delivery to China.

Consisting primarily of butanes and propane, LPG finds applications in cooking, heating and public transport.

Japanese LPG carrier Mushashi Gloria lifted the first 43,000-tonne consignment from Kürstø north of Stavanger on 22 January for delivery in Japan 30 days later.

“These contracts are the result of resolute work over a long period to secure acceptance of the Norwegian export quality in Asia,” says senior trader Nils Eivind Breivik.

Such efforts include shipping Japanese analysis equipment to Kürstø in order to check quality in line with methods accepted in Japan.

Mr Breivik regards Japan and China as the world’s most important import markets for LPG.

He also believes that Statoil has gained a strong position globally with this commodity through the group’s access to large volumes, unique infrastructure and able trading organisation.

Norway ranks as the world’s third largest exporter of LPG after Saudi Arabia and Algeria, with Statoil responsible for the majority of the country’s sales.

The group’s share of these exports totals about five million tonnes per annum, delivered from Kårstø and Mongstad near Bergen. These plants have big storage facilities and modern ports.