Cheniere pens long-term LNG supply deal with Equinor

US LNG exporting giant Cheniere has signed a long-term supply deal with Norway’s Equinor.

Under the sales and purchase agreement, Cheniere Marketing will supply about 1.75 million tonnes per annum (mtpa) of LNG to Equinor on a free-on-board basis.

According to a statement by Cheniere, the Henry Hub-indexed deal includes a fixed liquefaction fee.

Delivery of half of the volume associated with the SPA will start in 2027, and delivery of the remaining half, which is subject to, among other things, a positive final investment decision with respect to the first train of the Sabine Pass expansion project, will start at the end of this decade, it said.

The term of the SPA is 15 years from the start of delivery of the full 1.75 mtpa of LNG volumes.

Deal supports Sabine Pass LNG expansion plans

This agreement brings the total volumes that Equinor has contracted with Cheniere up to around 3.5 million tonnes per year.

Cheniere and Equinor announced a SPA in June last year for about 1.75 mtpa with half of the volumes related to the additional liquefaction capacity at the Corpus Christi LNG terminal beyond the seven-train Corpus Christi Stage III project.

Sabine Pass currently has a capacity of about 30 mtpa following the launch of the sixth train in February last year, while Cheniere’s three-train Corpus Christi plant in Texas can produce about 15 mtpa of LNG and is undergoing expansion.

In February this year, Cheniere initiated the pre-filing review process with the US FERC for the proposed Sabine Pass Stage 5 expansion project.

The project will include up to three large-scale liquefaction trains, each with a production capacity of about 6.5 mtpa of LNG, a boil-off-gas (BOG) re-liquefaction unit with a production capacity of 0.75 mtpa of LNG, and two 220,000-cbm LNG storage tanks.

“We are pleased to expand our relationship with Equinor, one of Europe’s leading energy companies, building upon the SPA we executed last year,” Jack Fusco, Cheniere’s CEO said in the statement.

Fusco said this SPA is expected to provide further commercial support to the SPL expansion project, which the company continues to “rigorously” develop in order to meet the world’s growing demand for LNG.

Equinor increasing its role as LNG supplier

Equinor said in a separate statement that the LNG market is expected to grow “significantly” because of the role it will play in providing energy security as well enabling a transition to a cleaner energy mix in many markets.

With more US LNG in its portfolio, Equinor will increase its role as a supplier of natural gas in global markets while maintaining its position as the major supplier of natural gas to Europe, it said.

Equinor operates the 4.3 mtpa Hammerfest LNG export plant on the island of Melkoya, Norway.

Most Popular

LNG carrier arrives to load first LNG Canada cargo

The 174,000-cbm GasLog Glasgow has arrived at the LNG Canada jetty in Kitimat to load the first LNG cargo produced at the Shell-led terminal, an LNG Canada spokesperson told LNG Prime on Saturday.

Knutsen, Shell name ninth LNG newbuild

Norwegian shipowner Knutsen and UK-based energy giant Shell have named the ninth and final LNG carrier in a series of 174,000-cbm vessels.

BP seals LNG SPA with Italy’s A2A

UK-based energy giant BP has signed a long-term liquefied natural gas (LNG) supply deal with Italian electricity and gas distributor A2A.

More News Like This

Cheniere’s Corpus Christi expansion project 85.4 percent complete

The Stage 3 expansion project at Cheniere’s Corpus Christi LNG export plant in Texas is 85.4 percent complete.

Cheniere plans to boost LNG export capacity to 100 mtpa

US LNG exporting giant Cheniere plans to boost its export capacity to about 100 mtpa via new expansion projects at its Sabine Pass and Corpus Christi LNG terminals.

Cheniere takes FID on two more Corpus Christi LNG trains

US LNG exporting giant Cheniere has made a positive final investment decision to build two more midscale trains at its Corpus Christi LNG plant in Texas. The company has also issued full notice to proceed to Bechtel.

Norway’s Equinor names new gas and power head

Norwegian energy firm and LNG terminal operator Equinor has named Helle Ostergaard Kristiansen as the new head of its gas and power business.