London-based INEOS Energy has signed a long-term agreement with U.S. energy company Kinetik Holdings, under which the latter will supply natural gas to Europe.
Starting in 2027, Kinetik is set to deliver up to 0.5 mtpa of natural gas. According to the UK player, this is enough to heat a city like Manchester, Antwerp, or Cologne – or more than 500,000 homes – for a year.
As reported, the agreement uses a Title Transfer Facility (TTF) Netback pricing mechanism, directly linking the price of U.S. natural gas sourced from Kinetik’s infrastructure to Europe’s benchmark gas market. In addition to tracking European market conditions, this is expected to reduce exposure to supply shocks and price swings.
“Kinetik’s strategic partnership with a global chemicals leader like INEOS Energy broadens and diversifies attractive natural gas pricing options for our producer customers. This arrangement exemplifies our commitment to delivering innovative and value-added solutions to producers in the Permian Basin,” said Jamie Welch , President & CEO of Kinetik.
INEOS believes that years of under-investment and policy uncertainty are responsible for Europe’s struggle with tight supplies and volatile prices. The company sees the latest deal as a practical step to fix that by securing new, reliable energy flows from America.
David Bucknall , CEO of INEOS Energy, noted: “Europe has paid a heavy price for failing to secure its own energy. We’re doing something about it. This deal will bring more U.S. gas into Europe, helping to keep the lights on, factories running and homes warm, at competitive prices. It’s good for industry, good for jobs and good for energy security.”
The U.K. company recently broadened its footprint in the U.S. by acquiring the business previously held by CNOOC’s subsidiary. The deal encompasses a portfolio of non-operated assets built around two deepwater early production assets, Appomattox and Stampede, in the Gulf of America