UK-based petrochemicals giant Ineos has signed an agreement with US liquefied natural gas exporter Sempra Infrastructure for the supply of 1.4 million tonnes per annum of LNG for 20 years, it announced on Wednesday.
The Sempra subsidiary said the heads of agreement (HoA) provides the framework for the negotiation and finalisation of a definitive 20-year LNG sale and purchase agreement.
"We are delighted to begin a strategic relationship with Sempra Infrastructure bringing significant expertise in construction and operation of LNG facilities,” said Ineos Energy chief executive David Bucknall.
“This agreement is an important part of our strategy as we build a network of liquefaction, shipping and regasification capacity to deliver affordable, cleaner and reliable energy to our businesses and customers globally.”
The potential long-term supply of LNG will be delivered free-on-board from export facilities under development at the proposed Port Arthur LNG project or Cameron LNG phase two project.
“This HOA demonstrates our ongoing momentum in advancing our next generation of LNG export facilities with an eye toward supplying US natural gas to some of the world’s leading energy and manufacturing companies,” said Sempra Infrastructure chief executive Justin Bird.
Sempra noted that the deal is still a preliminary non-binding arrangement subject to the two LNG projects securing all necessary permits, engineering and construction contracts, obtaining financing and a final investment decision.
Sempra Infrastructure said it is working to expand its Gulf Coast LNG asset base through the simultaneous development of the Port Arthur LNG project in Jefferson County, Texas, and the proposed expansion of the Cameron LNG facility in Hackberry, Louisiana.
In May Sempra Infrastructure announced an HoA with PGNiG for 2 million tpa from the Cameron LNG 2 project and 1 million tpa from the Port Arthur LNG project.
The company also announced an HoA with RWE Supply and Trading for 2.25 million tpa from the Port Arthur LNG project.
The Port Arthur LNG phase one project has received all major permits and is anticipated to include up to two natural gas liquefaction trains capable of producing, under optimal conditions, approximately 13.5 million tpa of LNG.
The proposed Cameron LNG 2 project, expected to include a single LNG train with a maximum production capacity of 6.75 million tpa of LNG, continues to reach a number of important commercial and permitting milestones, including the launch of a competitive front-end engineering design process.