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Skangass and North European Oil Trade (NEOT) have sealed a liquefied natural gas (LNG) supply contract for vessels chartered by NEOT, which are due to enter into operation in 2016.

The contract covers the supply of LNG in the area comprising Lysekil, Gothenburg and Skaw, and is also one of the first ship-to-ship bunker contracts for LNG in Europe.

"This is our first ship-to-ship bunker contract and we are very pleased with being chosen as LNG supplier for NEOT, serving their new vessels," commented Tor Morten Osmundsen, CEO for Skangass.

"LNG has a fantastic potential as fuel for vessels and we are determined to further develop the infrastructure to serve the market with LNG in an attractive way. A ship-to-ship supply solution is the logical development for bunkering of LNG in the future as the vessels using LNG as fuel seems to be enlarging."

Skangass currently carries out the supply of LNG to marine customers by truck to ship, terminal to ship and ship to ship - "whatever is the swiftest and best solution for the ship owner", the company says.

"The agreement with NEOT confirms the effort of making LNG available for the marine market. It further confirms the increasing LNG demand. This can be related to LNG being price competitive and not least a clean fuel that meets the MARPOL Protocol regulations of less sulphur emissions of only 0.10% m/m in the ECA area (Emission Control Area)," Skangass said.

Satu Mattila, Chartering Manager at NEOT, remarked: "We believe LNG technology will help us to ensure continuous operations in the Baltic Sea region by meeting the Sulphur Emission Control Area (SECA) requirements, binding from the 1st January 2015. Skangass has shown great willingness to secure supply of LNG to the two new time chartered vessels and we are convinced that this will work swiftly when we go into operation."