Equinor (EQNR), Gasum Extend LNG deal to revive maritime sector

Equinor ASA EQNR, the Norwegian state-owned energy giant, and Finnish energy company Gasum have extended their long-term liquefied natural gas (LNG) bunkering contract. This agreement ensures that Gasum will continue to supply LNG to Equinor’s dual fuel charter fleet, underlining both companies’ commitment to reducing emissions in the maritime sector.

The renewed contract, which is a continuation of the existing cooperation between Gasum and Equinor, dates back to 2011. It covers not only the supply of LNG, but also additional ancillary services, such as cooling and gassing, necessary for the efficient operation of LNG-fueled power plants. These services are an integral part of the partnership, contributing to a smooth transition and operational efficiency of the Equinor fleet.

Gasum highlighted the use of its specialized bunkering vessels, Coralius, Kairos and Coral Energy, for bunkering operations. These vessels played a key role in carrying out three separate LNG cooling operations for Equinor in Skagen, demonstrating operational readiness and logistical coordination between the two companies.

In his statement, Gasum highlighted the direct environmental benefits of using LNG and bio-LNG. The company is on a strategic path to bring 7 terawatt-hours (TWh) of renewable gas to market by 2027. This ambitious target is expected to lead to a cumulative reduction of 1.8 million tonnes of carbon dioxide emissions for customers annually, representing a clear commitment to reducing greenhouse gas emissions.

Equinor, which has been cooperating with Gasum to supply LNG to shuttle tankers since the beginning of 2020, also extended its LNG bunkering agreement to the Amsterdam-Rotterdam-Antwerp region in the same year. In 2022, Equinor reaffirmed its commitment by exercising the option to extend the contract, reflecting the trust and reliability gained through the collaboration.

Both Gasum and Equinor are deeply committed to sustainability. Equinor aims to become a net-zero energy company by 2050, part of a broader global effort to combat climate change. By using LNG and bio-LNG, both companies not only increase the operational efficiency of their fleets, but also significantly contribute to reducing greenhouse gas emissions.

The extension of the LNG bunkering agreement between Gasum and Equinor highlights the key role of strategic partnerships in achieving sustainable development goals. It also highlights the potential of LNG as a viable solution to reducing the environmental impact of maritime activities.

Zacks Rank and Key Picks

Equinor currently carries a Zacks Rank #3 (Hold).

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