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Lloyds List: Shell wins Nakilat LNG contract

By: Oil major to manage 27 ships for Qatar company in 25-year deal, writes Tony Gray, Lloyds List: Published: Nov 21, 2006

A prestigious contract to manage at least 27 liquefied natural gas carriers owned by Qatar Gas Transport (Nakilat) has been won by Shell.

Nakilat, which has ambitions to become a leading operator in gas shipping, has awarded Shell International Trading and Shipping a 25-year deal.

As a result, Shell will have more than 50 LNG carriers under management.

The agreement foresees that operational management of the Nakilat vessels will be transferred to the Qatari company within a 12-year timeframe.

The Shell’Nakilat deal appears to follow the model established by Abu Dhabi’s National Gas Shipping Co which employed another oil major, BP, to help with the technical management of the company’s LNG carrier fleet soon after it was established in 1993.

Last week, NGSCO disclosed it was taking responsibility for the technical management of its whole fleet of LNG carriers following an agreement with BP affecting four vessels.

The BP partnership with NGSCO has run for 12 years.

The market has been eager to discover how Nakilat would handle management of its fleet following the company’s move from partial ownership of vessels, in co-operation with international shipowners, to full ownership.

Shell will provide Nakilat with a range of shipping services, including shipmanagement.

The oil major will also transfer knowhow and expertise with the aim of enabling Nakilat to develop its own LNG ship management company in Qatar.

Nakilat said the pact with Shell covers LNG vessels under construction, each with a capacity of about 215,000 cu m and 265,000 cu m. The vessels, fully-owned by Nakilat, will be put into service over the next four years to transport product from four of Qatar’s major LNG projects: Qatargas II (Train 5), Qatargas 3 (Train 6), and, subject to the agreement of the joint venture partners, RasGas III (Train 7) and Qatargas 4 (Train 7). Qatar’s ambition is to become the largest LNG supplier in the world by 2011.

Faisal Al Suwaidi, vice-chairman of Nakilat and chief executive of Qatargas, said the shipping component of the value chain is ‘critical’ if this ambition is to be fulfilled.

‘Our aspiration is to develop a world-class centre of excellence for LNG shipping in Qatar,’ he said.

‘We chose Shell because we believe Shell has the track record, knowledge and skills to help us reach our goal.’

Shell Gas and Power’s executive director Linda Cook said Qatar is ‘well positioned’ to be the world leader in LNG.

Shell is already involved in more than a quarter of all LNG cargoes delivered.

‘Today’s agreement is aligned with our broader strategy of helping Qatar develop its natural gas resources and further strengthens a well-established relationship,’ Ms Cook said. and its sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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