Germany’s Securing Energy for Europe (SEFE) has finalized a multi-year liquefied natural gas (LNG) supply agreement with Argentina’s Southern Energy (SESA) against the backdrop of rising energy security concerns that are looming over Europe and the globe in the wake of the U.S.-Israel military operation against Iran, which decided to close the Strait of Hormuz.
SEFE and Argentina’s Southern Energy have entered into a sales and purchase agreement (SPA) for an eight-year LNG supply partnership, which enables the German player to buy 2 million tonnes per annum (mtpa) of LNG on a free on board (FOB) basis, with deliveries scheduled to begin in late 2027.
Frédéric Barnaud , CCO of SEFE, commented: “Thanks to our shared determination and focus, we’ve moved from an Heads of Agreement to a fully-fledged Sales and Purchase Agreement in just over three months. This rapid progress shows that SESA is the right partner for us to expand our portfolio into South America and thereby strengthen Europe’s energy security.
“With deliveries starting already in 2027, we’re not only the first German energy company to offtake cargoes from Argentina, but also the country’s first long-term LNG customer globally.”
The SPA follows the heads of agreement concluded in Argentina last year, marking the country’s first long-term LNG export contract and turning SEFE into the South American player’s first long-term LNG offtake partner. The volumes are said to represent one third of Southern Energy’s projected annual LNG output.
Rodolfo Freyre , Chairman of SESA, highlighted: “The agreement with SEFE is significant for two key reasons: on the one hand, it confirms Argentina’s positioning as a new and strategic international LNG supplier, contributing to the diversification of global supply sources; on the other hand, it represents a key contribution to strengthening Europe’s energy security.”
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Southern Energy is dedicated to breathing life into Argentina’s first large-scale LNG export venture, comprising two floating LNG terminals (FLNGs) with a combined capacity of about 6 mtpa. The first FLNG, Hilli Episeyo , will produce 2.45 mtpa from the end of 2027, while the second, MK II , will add 3.5 mtpa from late 2028.
Securing Energy for Europe also took steps to seal a multi-year LNG supply deal with ADNOC Gas, shortly after firming up an LNG arrangement with Venture Global and a gas deal with the State Oil Company of the Republic of Azerbaijan (SOCAR).