US LNG firm Tellurian, the developer of the Driftwood LNG export project in Louisiana, said that its LNG supply deal with trader Gunvor was terminated.
This was the only LNG supply deal Tellurian had for the planned Driftwood LNG project after both of its LNG supply deals with Shell and Vitol fell through.
Back in May 2021, Tellurian agreed to supply 3 million tonnes per annum on a free on board (FOB) basis to Gunvor Singapore for a period of 10 years.
On August 1, 2023, the LNG sale and purchase agreement, dated as of May 27, 2021, as amended, between Driftwood LNG, a unit of Tellurian, and Gunvor Singapore was terminated, Tellurian said in a filling with the US SEC.
“The parties were unable to reach agreement on the commercial terms of an amendment to the agreement,” it said.
Tellurian added that the company’s “focus continues being on investment-grade counterparties”.
Driftwood LNG construction progressing
This week, Tellurian reported a wider net loss in the second quarter, while its gas production almost doubled compared to the same period in 2022.
Tellurian also said that Bechtel is “progressing very well” on Driftwood LNG construction, having driven over 9,000 piles and poured over 10,000 cubic feet of concrete for plant one and the storage tanks.
The US LNG firm issued a limited notice to proceed to compatriot engineering and construction giant Bechtel in March last year.
Tellurian’s shareholders recently approved doubling the number of its common shares, as the US LNG firm continues to work on financing the first phase of its Driftwood LNG export plant and signing deals with equity partners.
The LNG terminal developer is expecting the development costs for the first phase of its Driftwood LNG export plant in Louisiana to reach $14.5 billion.
Under the first phase, Tellurian aims to build two LNG plants near Lake Charles with an export capacity of up to 11 mtpa.
As part of its financing strategy, Tellurian entered last month into a binding commitment letter with a fund of Blue Owl Real Estate Capital regarding the sale and leaseback of Driftwood land.