US liquefied natural gas exporter Cheniere Energy has signed a deal to supply LNG to South Korea.
The sale and purchase agreement with Korea Southern Power (KOSPO) was signed on Tuesday for the supply 400,000 tonnes per annum of LNG from 2027 through 2046.
Cheniere will also deliver a smaller quantity of LNG starting in 2024.
The LNG volumes from 2028 to 2046 will be dependent on a positive final investment decision for the first train at Cheniere’s Sabine Pass liquefaction expansion project.
“We are pleased to enter into this long-term LNG contract with KOSPO, the leading power generation company in Korea, in support of KOSPO’s growing natural-gas fired power generation capacity,” Cheniere chief executive Jack Fusco said.
He said the agreement is expected to support the Sabine Pass liquefaction expansion project and also “highlights Cheniere’s leadership in providing flexible, cleaner burning energy supply to meet both the energy security needs and environmental goals of our customers in both the short and long term”.
The Sabine Pass expansion plans to include up to three natural gas liquefaction trains with a capacity of 20 million tpa.
LNG delivered before 2027 will be under a market-based price, while subsequent deliveries will be indexed to the Henry Hub price, plus a fee.