18 October 2023: National Gas and Industrial Company (Gasco), the largest Liquefied Petroleum Gas (LPG) distributor in the Kingdom of Saudi Arabia, and Hexagon Composites' subsidiary Hexagon Ragasco have signed a long-term distribution agreement. The five-year contract (2023-2028) covers the provision and distribution of custom-made LPG cylinders on the Saudi Arabian domestic market and is valued at approximately 20 million euros.
Gasco has played a significant role in the development of the composite cylinder market in Saudi Arabia, which is the largest market for domestic LPG utilization in the Middle East. Since 2015, Hexagon Ragasco has been a supplier to Gasco.
A Collaborative Strategy for Enhancing Operational Effectiveness
The new custom-sized composite cylinder by Hexagon Ragasco is specifically designed to increase Gasco’s filling and logistical operational efficiency. The broader and shorter cylinder fits seamlessly with Gasco’s filling systems and logistic equipment, making filling, storage, and transport of the cylinders more streamlined and efficient.
“We are pleased to have this agreement in place with our long-time partner, Hexagon Ragasco. Hexagon Ragasco’s collaborative approach continually adds value to our business. The new cylinder is designed specifically for our existing pallets and bottling systems, allowing us to fill and deliver modern LPG composite cylinders more cost-effectively to customers that reap the benefits of lightweight, durable composite cylinders and a lower CO2 footprint" says Eng. Abdulrahman Bin Sulaiman, CEO of Gasco.
The new cylinder will be manufactured at Hexagon Ragasco’s world-class, high-volume, fully automated production facility in Raufoss, Norway.
"This is our second long-term distribution agreement with Gasco—an alliance that has strengthened our position in the Middle East region over the last decade. As a preferred supplier, we are able to engage with Gasco’s team and help them address some of the operational challenges that face business growth in a key region for both the LPG industry and Hexagon Ragasco," says Skjalg Stavheim, President of Hexagon Ragasco. "Today’s announcement is an example of the role customer intimacy plays in driving innovation."
Timing
The first new composite LPG cylinders will be shipped and introduced to the Saudi market in 2024.
For more information:
Karen Romer, SVP Communications, Hexagon Composites ASA
Telephone: +47 950 74 950 | karen.romer@hexagongroup.com
Ingrid Aarsnes, VP Investor Relations and ESG, Hexagon Composites ASA
Telephone: +47 950 38 364 | ingrid.aarsnes@hexagongroup.com
About National Gas and Industrial Company (Gasco)
Gasco was incorporated in 1963 (1383H) via the merger of National Gas Company in Dammam and its two branches in Riyadh and Jeddah, together with Saudi manufacturing and Gas Company in Riyadh and its branches in Dammam.
Gasco's main activities are transportation, filling, distributing, and marketing of Liquefied Petroleum Gas (LPG), which consists of propane (C3H8), butane (C4H10), or a mixture of both. Gasco has generated revenues of more than SAR 2 billion in 2022.
About Hexagon Ragasco AS
At Hexagon Ragasco, we are committed to quality, safety, and innovation. We are the leading manufacturer of composite LPG cylinders, with an industry-leading safety record of 20+ years and more than 20 million cylinders sold worldwide. Our products bring unique benefits to both LPG marketers and their customers.
LPG has a significant role to play as a transitional energy source with the potential to improve air quality and health for billions of people who rely on highly polluting and toxic fuels as their primary energy source. We believe in cleaner air and safer LPG for everyone, everywhere.
Learn more at www.hexagonragasco.com and follow @Hexagon_Ragasco on Twitter and LinkedIn.
About Hexagon Composites
Hexagon delivers safe and innovative solutions for a cleaner energy future. Our solutions enable storage, transportation, and conversion to clean energy in a wide range of mobility, industrial and consumer applications.
Learn more at hexagongroup.com and follow @HexagonASA on Twitter and LinkedIn
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act. This stock exchange release was published by Ingrid Aarsnes, VP IR & ESG, Hexagon Composites ASA on 18 October 2023 at 18:45 CEST.
