China Gas Hongda Energy Trading, a subsidiary of Chinese piped-gas operator China Gas, and energy and commodities company Vitol have signed a long-term liquefied natural gas (LNG) swap agreement.

Under the agreement, Vitol is set to buy 0.5 million metric tons of LNG from China Gas’ contracted U.S. volume on a free-on-board (FOB) basis and sell equally as much to the Chinese company on a delivered ex-ship (DES) basis starting in 2029.

China Gas’ Chairman, Liu Ming Hui, said: “The swap deal with Vitol, a renowned global energy trading tycoon, diversifies our LNG portfolio, strengthens downstream supply, and enhances efficiency across the value chain. We are confident that with Vitol’s sustainable support, our two companies will explore even more comprehensive collaborations in the future, and from this moment, China Gas’s clean energy business will develop and expand steadily.”

Vitol claims to have delivered over 17 million tonnes of LNG worldwide in 2023, while the Chinese company, which operates 661 pipeline natural gas projects and 32 long-distance pipeline projects, has an annual natural gas sales volume of 36 billion cubic meters.

“Vitol’s LNG trading and freight management capability, combined with our global footprint, will help China Gas optimize their LNG portfolio,” noted Pablo Galante Escobar, Head of Vitol’s LNG, EMEA Gas and Power. “We look forward to strengthening our relationship with China Gas as we work to identify further opportunities. Vitol is committed to offering reliable and flexible LNG solutions to customers worldwide.”

Ocean Jade Invested Limited, China Gas’ joint venture with Huaguang Shipping and CSSC Leasing, recently hired Dalian Shipbuilding Industry Company (DSIC) to build two 175,000 cubic meter large-scale LNG vessels.

Meanwhile, Vitol says it is ‘on track’ to meet the International Maritime Organization’s (IMO) 2030 target thanks to its fleet dry dock program. The firm also decided to boost its LNG vessel arsenal with three new tankers.