Oil giant BP plc BP and The Kansai Electric Co., Inc. have inked a sales and purchase deal for liquefied natural gas (LNG). The two companies signed a cooperation agreement relating to exploration of opportunities for business collaboration as well. The market, however, did to respond positively to the announcement as the company’s share price has been fluctuating with the stock falling by 0.7% in the last trading session.
Per the deal, BP will supply about 13 million tons of LNG to Kansai Electric over a period of 23 years from its diverse portfolio of LNG sources. Moreover, the agreements will allow both companies to explore areas of cooperation across an extensive range of LNG business activities that include LNG trading as well as boost LNG ship operations.
The long-term relationship between BP and Kansai Electric has made the closure of these new LNG sales and co-operation agreements highly successful.
Established in 1951, The Kansai Electric Power Co., Inc. is Japan’s second-largest electric utility. The company has 22,000 employees and serves 13 million customers.
BP is one of the world's major energy companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemical products.
BP is actively involved in several of the main LNG producing regions in the world along with the key LNG markets. The company participates in LNG projects in Australia, UAE, Indonesia, Egypt, Trinidad and Angola. BP’s train 2 of the Freeport LNG Project in Texas, USA (Freeport) has a liquefaction tolling agreement of more than 4.4 mtpa LNG capacity.
BP currently carries a Zacks Rank #2 (Buy). Some other players from the same space that are worth considering include Transmontaigne Partners L.P. TLP, LRR Energy, L.P. LRE and Pembina Pipeline Corporation PBA. All these stocks sport a Zacks Rank #1 (Strong Buy).
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