/Beijing/ OAO NOVATEK (“NOVATEK”) announced the conclusion of Heads of Agreement for the supply of liquefied natural gas (LNG) between Yamal LNG and China National Petroleum Corporation (“CNPC”). The document provides for the supply of no less than three (3) million tons of LNG per annum at delivered ex-ship (DES) terms for a period of 15 years with possible supply extension, with the LNG price is indexed to the Japanese Crude Cocktail.
Yamal LNG is a joint venture currently owned by OAO NOVATEK (80%) and Total S.A. (20%). On 5 September 2013 NOVATEK and CNPC concluded an agreement on purchase of a 20% equity share in Yamal LNG by CNPC. The transfer of title to the equity share is subject to receipt of necessary regulatory approvals and expected to be completed by 01 December 2013. Following completion of the deal, the shareholder structure of Yamal LNG will be as follows: OAO NOVATEK (60%), Total S.A. (20%) and CNPC (20%).