Largest US LNG exporter Cheniere Energy signs another long-term LNG supply agreement with PetroChina

Thursday, 21 July 2022
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Cheniere Energy, the largest US LNG exporter from its six-Train Sabine Pass plant in Louisiana and its three-Train facility at Corpus Christi in Texas and with expansion plans, has signed another long-term sale and purchase agreement with PetroChina.

PetroChina is the Hong Kong-listed unit of China National Petroleum Corp. (CNPC) and has a stake in Shell’s Canada LNG project in British Columbia.

CNPC itself additionally has shareholdings in two Russian Arctic LNG projects and in ExxonMobil’s stalled Mozambique LNG export venture.

Under the SPA with Cheniere, PetroChina subsidiary PetroChina International (PCI) has agreed to purchase up to 1.8 million tonnes per annum of LNG from the Cheniere Marketing unit on a free-on-board basis whereby the Chinese provide their own shipping.

Deliveries under the SPA will begin in 2026 and reach the full 1.8 MTPA in 2028 and they will continue through 2050.

The purchase price for LNG under the SPA is indexed to the Henry Hub price, plus a fixed liquefaction fee.

Expansion volumes

Half of the total volume, or about 900,000 tonnes, is subject to Cheniere making a positive final investment decision to construct additional liquefaction capacity at the Corpus Christi plant beyond the expansion with seven mid-scale Trains already approved and known as the Corpus Christi Stage 3 Project.

“We are pleased to build upon our existing and successful long-term relationship with PetroChina and sign our first LNG contract that crosses over into the second half of this century,” said Jack Fusco, Cheniere’s President and Chief Executive.

“PetroChina is a leading energy company in one of the largest and fastest growing markets for LNG,” added Fusco.

“This SPA increases Cheniere’s long-term sales to PetroChina to approximately 3 MTPA, and we are proud to support China’s progress toward a lower-carbon future with our reliable, cleaner burning LNG,” declared the Cheniere CEO.

The Executive Chairman of PCI, Tian Jinghui, also commented on the LNG agreement with the Houston-based company.

“Natural gas continues to play a vital role in enabling energy transition in China,” said Tian.

“We are pleased to further expand our cooperation with Cheniere in delivering LNG, one of the cleanest fuel choices to our millions of customers for many years to come,” he added. 

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