U.S. LNG export project developer Cheniere Energy has signed a long-term IPM gas supply deal with Canadian natural gas producer ARC Resources for its Corpus Christi LNG Stage 3 project.
On 4 May, Cheniere announced today that its subsidiary Corpus Christi Liquefaction Stage III has entered into a long-term integrated production marketing (IPM) gas supply agreement with ARC U.S., a subsidiary of ARC Resources.
Under the IPM, ARC U.S. will sell 140,000 MMBtu per day of natural gas to Corpus Christi Stage III for a term of 15 years, starting with commercial operations of Train 7 of Corpus Christi Stage III project.
Cheniere will market the LNG associated with this gas supply, approximately 0.85 million tonnes per annum (MTPA). It will pay ARC U.S. an LNG-linked price for its gas, based on the Platts Japan Korea Marker (JKM), after deductions for fixed LNG shipping costs and a fixed liquefaction fee.
ARC Resources will act as guarantor of the IPM agreement on behalf of ARC U.S. The IPM agreement is subject to Corpus Christi Stage III making a positive final investment decision.
“We are pleased to enter into this long-term IPM agreement with one of Canada’s largest natural gas producers, enabling Canadian natural gas to reach international markets,” said Jack Fusco , Cheniere’s CEO. “This IPM agreement with ARC U.S. is expected to provide additional support to the Corpus Christi Stage III Project, which we expect to reach FID this summer.”
The Corpus Christi Stage III project, a part of Corpus Christi LNG, will include up to seven midscale liquefaction trains with a total expected nominal production capacity of over 10 MTPA.