The memorandum of understanding (MOU) is for between 120,000 and 360,000 tonnes per annum delivered to the client’s operations in South Africa.

The company said it would now proceed to complete a pre-feasibility study into the supply of LNG into several regions in South Africa; following which it is anticipated that a definitive LNG sales agreement and development agreement would be concluded.

Managing Director Maurice Brand said that the new MOU was a major step for LNG Ltd as it diversified its country risk profile, being the first of the company’s proposed LNG supply projects to a country other than India.

“This agreement also lifts the company ’s total LNG supply profile to 1,715,000 tonnes per annum (4,700 tonnes per day) enabling the company to remain confident of achieving its contracted LNG sales target of 1,825,000 tonnes per annum (5,000 tonnes per day) by 30 June 2005, as outlined in the company’s recent prospectus,” said Brand.