UK utility Centrica said it entered into a three year contract with Qatargas to deliver 2.4 million tons per annum of liquefied natural gas to the UK’s Isle of Grain terminal.
Centrica said the £2 billion pound ($3.24 billion) deal will provide enough gas to meet a tenth of UK annual residential gas demand, enough to meet the needs of around 2.5 million households.
“With increasing global competition from emerging economies for LNG, and declining North Sea production, this transaction secures important gas supplies for Centrica and the UK for the next three years,” Centrica said in a statement.
First gas is expected to be delivered under the contract in June.
Since the UK expanded its LNG receiving capacity last year, largely to reduce overdependence on a steady flow of gas from the North Sea, it has steadily increased imports of the liquefied fuel which is warmed back to gas before being pumped into the network.