01 Dec 2020 | 09:25 UTC — London

Trader Glencore closes acquisition of LNG business from Denmark's Orsted

Highlights

Orsted had 3 Bcm/year of capacity at Gate to 2031

Agreement includes number of LNG supply contracts

Orsted repositioning itself in renewable energy

London — Global trader Glencore said Dec. 1 it had closed the acquisition of the LNG business of Denmark's Orsted, which includes 3 Bcm/year of capacity at the Gate LNG import terminal in the Netherlands.

The agreement was first announced in December 2019.

Glencore said the agreement involved the company taking over a number of LNG contracts, including the Gate capacity which is due to run to 2031.

The transaction also involves a payment from Orsted to Glencore.

"We are increasingly focusing on the LNG business as a key part of our oil division strategy and the Orsted transaction represents an important milestone," Alex Sanna, head of Glencore oil marketing, said.

"We see good opportunities in the market place and we are excited to continue to grow our LNG marketing portfolio," Sanna said.

At the time of the deal, Orsted said its LNG business consists of the Gate capacity "and five LNG purchase agreements."

Orsted -- formerly DONG Energy -- in December 2007 entered into a 20-year agreement for the right to the Gate capacity from 2011 to 2031.

The company said at the time of the deal with Glencore that its LNG business had been loss-making over the past few years and had been projected to remain so for years to come.

Orsted -- which has repositioned itself as a renewable energy company -- said it had become clear that LNG trading would not be a part of its future core business.


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