US LNG export player Cheniere Energy said on Friday it had entered into two liquefied natural gas sale and purchase agreements with state-owned China National Petroleum Corporation.
This is the first long-term contract for US LNG supplies to China, currently the world’s second-largest LNG importer.
Under the SPAs with Cheniere’s subsidiaries, Corpus Christi Liquefaction and Cheniere Marketing International, CNPC unit PetroChina International will buy about 1.2 million tonnes per annum of LNG, a Cheniere statement said.
A portion of the supply will start in 2018 with the balance beginning in 2023. The term of each deal will continue through 2043, the statement said.
The purchase price for LNG will be indexed to the Henry Hub price plus a fixed component.
These long-term SPAs build upon the memorandum of understanding signed between the two companies in November 2017.
Cheniere Energy owns and operates the Sabine Pass liquefaction terminal in Louisiana, that started shipping the fuel in 2016. It is still the only such facility to ship U.S. shale gas overseas.
The company is also building the Corpus Christi LNG export facility on the U.S. Gulf Coast that is planned to have a 23 mtpa production capacity. Two liquefaction trains are currently being built at Corpus Christi with Cheniere planning to add another one.
“We expect these agreements to support the development of Corpus Christi Train 3, and we are now focused on completing the remaining necessary steps to reach a final investment decision later this year,” said Jack Fusco, Cheniere’s President and CEO.
LNG World News Staff