US LNG exporting giant Cheniere has signed a 20-year deal with a unit of South Korean steel producer Posco to supply the latter with liquefied natural gas from the proposed Corpus Christi expansion project in Texas.
Under the sales and purchase agreement, Cheniere Marketing will supply about 0.4 million tonnes per annum (mtpa) of LNG to Posco International on a free-on-board basis, beginning in late 2026.
Also, the Henry Hub-linked LNG deal would include a fixed liquefaction fee, Cheniere said in a statement on Wednesday.
Posco operates the 5.2 mtpa Gwangyang LNG terminal, South Korea’s first private LNG import facility, and the firm is adding new LNG tanks to the facility. Following completion in 2025, the terminal will have in total of eight tanks.
“FID this summer”
Cheniere said the new deal with Posco remains subject to the company making a positive final investment decision to construct the Corpus Christi Stage III Project.
Moreover, Cheniere’s CEO Jack Fusco said in the statement that this SPA with POSCO “further evidences the growing demand for long-term LNG supply”.
“The SPA is expected to provide additional support to the Corpus Christi Stage III Project, on which we expect to reach FID this summer,” he said.
The Corpus Christi liquefaction plant now consists of three operational trains with each having a capacity of about 5 mtpa.
Under the expansion, Cheniere plans to add up to seven midscale trains, each with an expected liquefaction capacity of about 1.49 mtpa, with a total production capacity of more than 10 mtpa.
Cheniere recently won an extension from FERC to build the expansion project by June 30, 2027.
In addition, Cheniere awarded earlier this year a lump sum, turnkey, engineering, procurement and construction contract to compatriot Bechtel for the expansion.
Bechtel has already begun early engineering, procurement and other site works under limited notice to proceed.