Offtake agreements are legally binding contracts related to transactions between buyers and sellers. The provisions usually specify the purchase price for the goods and the delivery date, even though the agreement is reached before any goods are produced and any ground is broken on a facility.

What does offtake agreement mean?

The offtake agreement is the agreement pursuant to which the off-taker buys all or a substantial portion of the output from the facility and provides the revenue stream supporting a project financing.

What is gas offtake?

As used in project financing, an agreement to purchase all or a substantial part of the output or product produced by a project. ... By contrast, if the project is the construction of a pipeline, the output agreement would be a gas or oil transportation agreement.