South Africa’s Renergen said it has signed another liquefied natural gas supply deal for its Virginia LNG and helium development.
According to a statement on Thursday, the firm would start supplying LNG from the first phase of its project to Johannesburg-based tile manufacturer and a unit of Italtile, Ceramic Industries, in the first quarter of 2022.
Under the five-year deal, Renergen said it would supply up to 800 gigajoules of LNG daily at a fixed price with annual escalation linked to the consumer price index.
In addition, the supply contract includes two more five-year renewal periods at the customer’s discretion.
The agreement is subject to several conditions, including Renergen successfully commissioning its first phase of operations.
Stefano Marani, CEO of Renergen, said this deal marked the second and final industrial contract from the first phase of the Virginia LNG project.
Last year, the natural gas and helium producer revealed it had signed its first LNG supply deal for its project with Consol Glass.
Also a unit of Italian contractor Saipem said last year it had won a front-end engineering and design contract for the second phase of Renergen’s project.
The second phase would significantly boost LNG volumes for distribution in South Africa while helium would go for exports, according to Renergen.