Ineos Energy, a unit of UK’s Ineos, is looking to buy about 1.4 million tonnes per year of LNG from Sempra Infrastructure’s liquefaction and export plants in the US.
In that regard, the two firms signed a heads of agreement for FOB volumes, according to a statement by Sempra Infrastructure, a unit of US LNG player Sempra, on Wednesday.
The HOA provides the framework for the negotiation and finalization of a definitive 20-year LNG sale and purchase agreement, it said.
Also, the volumes would come from the proposed Port Arthur LNG project under development in Texas, or the Cameron LNG Phase 2 project in Louisiana, according to Sempra.
Sempra is working to expand its Gulf Coast LNG asset base through the simultaneous development of the Port Arthur LNG project, as well as the proposed expansion of the Cameron LNG facility.
Ineos joins the company’s growing portfolio of global energy and manufacturing companies that have recently executed HOAs for potential long-term offtake from these projects.
The HOAs are preliminary non-binding arrangements, and the development of the Port Arthur LNG and Cameron LNG Phase 2 projects remain subject to a number of risks and uncertainties, including reaching a final investment decision, Sempra said.
Ineos enters LNG market
The long-term agreement marks Ineos’ entry into the global LNG market, and builds on the company’s “leadership position” in exporting ethane from the US, Ineos Energy said in a separate statement.
In addition, Ineos said the agreement comes at a “critical time” for energy markets and would provide much needed security of supply.
The firm intends to market the LNG supplies into global markets as well as supply its own industrial needs in Europe.
“Ineos intends to build partnerships with other industrial users of energy in Europe to help them access the same competitive sources of energy. It is the first market entrant to operate in this way in many years,” it said.