Kuwait Petroleum Corporation (KPC) signed a 15-year contract with Royal Dutch Shell for the import of liquefied natural gas (LNG), Bloomberg reports.
The contract will begin in 2020, according to the news agency.
KPC currently has contracts with Shell, Qatar Gas, and BP for the delivery of 2.5 million tons of natural gas a year, according to Gulf News. The current contracts are set to expire in 2020.
The quantity and price of the LNG imports were not disclosed, but a source told Bloomberg that Shell agreed to supply KPC with two to three million tons of natural gas a year at an 11% discount to Brent prices.
Using natural gas instead of oil to generate electricity could save Kuwait money.
“The big issue for Kuwait is they burn a lot of oil, most of their power generated is from oil, and so importing LNG for them is cheaper and frees up oil for export,” the CEO of Qamar Energy, Robin Mills, told Bloomberg.