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Under the agreement, Delfin Midstream’s Delfin LNG will supply LNG on a free-on-board (FOB) basis to Vitol, which will act as the offtaker and deliver the volumes to IRH Global Trading (IRHGT), IRH’s global trading arm.
The three firms said in a joint statement that definitive agreements are expected to be concluded in the coming weeks.
IRH is a mine-to-market platform and subsidiary of ePointZero.
Ali Rashed AlRashdi, CEO of IRH, said this transaction is a “major” milestone in the development of IRHGT’s global LNG portfolio.
“We are pleased to collaborate with Delfin and Vitol to help bring the project to final investment decision soon,” he said.
“As part of our vision to build an integrated global trading platform headquartered in Abu Dhabi, IRHGT is actively expanding its presence across physical and financial markets in natural gas, power, crude oil, refined products, metals, and equities,” AlRashdi said.
FID on first FLNG in “coming weeks”
In 2022, Delfin Midstream signed a long-term deal to supply 0.5 million tonnes per annum of LNG on a free on-board (FOB) basis for a 15-year period to a unit of energy trader Vitol.
In addition to the SPA, Vitol completed a strategic investment in the company.
Pablo Galante Escobar, global head of LNG and European gas and Power at Vitol, said the company’s “offtake commitments and investment grade rating will help Delfin on its path to financial close.”
“It’s an honor to have been selected by IRHGT and Vitol as a long-term liquefied natural gas supplier, and we look forward to working together as we make a final investment decision on the first FLNG vessel in the coming weeks,” Dudley Poston, CEO of Delfin, said.
“We are pleased to continue our very strong relationship with Vitol and add another world-class trading organization such as IRHGT to our growing list of strategic partners,” he said.
Samsung to build FLNG
Delfin Midstream recently entered into a letter of award with South Korea’s Samsung Heavy Industries for its first FLNG unit.
The LOA formally notified SHI that it has been selected and awarded as the exclusive EPCI contractor for the first FLNG of the Delfin LNG project, while Delfin is entitled to the exclusive rights to SHI’s dock for construction of the first FLNG.
As part of the LOA, the two firms have agreed to commence an early engagement scope of work, mobilize project teams, de-risk the overall project schedule, and prepare for imminent execution.
Delfin said its brownfield deepwater port requires minimal additional infrastructure investment to support up to three floating LNG vessels producing up to 13.2 million tonnes of LNG annually.
The Delfin floating LNG project has the potential to not only be the first LNG export deepwater port facility in the US, but also a “significant economic contributor and job creator over the long-term.”
Given the progress towards an FID for the first FLNG and “excellent” collaboration among all the project stakeholders, Delfin said the parties have agreed to strengthen their partnership in advance of the second and third FLNG for the Delfin project.
Under the LOA, the parties have agreed a dock reservation scheme for the second FLNG for the Delfin project following FID of the first FLNG which will enable Delfin to take an FID in early 2026 for the second FLNG.
For the third FLNG, Delfin and SHI plan to jointly develop strategic business and trade opportunities, including shipbuilding cooperation.
