LNG

Sempra has asked the US Department of Energy (DOE) to extend the export deadline for its $2.5 billion Energia Costa Azul LNG terminal on Mexico’s Pacific Coast. Construction delays push back commissioning to September 21, 2026.

Sempra Infrastructure, a subsidiary of California-based utility Sempra, has signed an engineering, procurement and construction contract with US firm Bechtel Energy for Phase II of the Port Arthur LNG export project in Texas.

Technip Energies, the leading European energy and liquefied natural gas project engineers, reported increased net profits and revenues as the backlog was also boosted by Middle East LNG contract awards in the United Arab Emirates and in Oman.

Sempra Infrastructure, a subsidiary of US utility Sempra and whose projects included Cameron LNG in Louisiana, Port Arthur LNG in Texas and Costa Azul LNG in Mexico, has signed a collaboration accord with the state-backed Japan Bank for International Cooperation (JBIC) covering future financial structuring opportunities.

Sempra said that through the memorandum of understanding, Sempra Infrastructure and JBIC aimed to further project structuring to improve the global energy supply chain through LNG and other decarbonization efforts in both the US and Japan.

“Sempra Infrastructure is thrilled to expand its collaboration with JBIC as we look forward to advancing projects that lower the carbon intensity of our energy delivery assets in North America,” said Justin Bird, Chief Executive of Sempra Infrastructure.

“We have built our relationships with customers and the export credit agencies in Japan over the past decade and are excited to expand our relationship with JBIC as we continue developing projects in support of our net-zero business,” Bird explained.

JBIC LNG role

“This collaboration will help us continue advancing our mission of developing energy infrastructure that provides access to safe, secure and affordable energy to our global partners,” the CEO declared.

Sempra noted that it had partnered in various ways with Japanese companies for many years.

“More recently, these partnership efforts are reflected in Sempra Infrastructure's Cameron LNG facility and a recently announced strategic collaboration with a Japanese consortium, which calls for an evaluation of potential enhancements of the energy supply chain through e-natural gas,” said Sempra.

“In addition, the company is developing the Hackberry Carbon Sequestration Project, which contemplates the participation of two Japanese companies. Both development projects are in close geographical proximity to the Cameron LNG facility,” Sempra stated.

As Japan's policy-based financial institution, JBIC has a mission to continue to financially support the creation of business opportunities for Japanese companies and to underpin the Asian nation’s energy security.

Mexico and Texas plants

Sempra Infrastructure in 2023 completed the sale of a stake in the Port Arthur LNG project in Texas to US asset management firm Kohlberg Karvis Roberts (KKR), which is already a stakeholder in the Infrastructure unit.

KKR now holds a 42 percent indirect, non-controlling interest share of the Port Arthur LNG Phase 1 project.

The transaction resulted in Sempra Infrastructure retaining a controlling 28 percent indirect interest in Port Arthur Phase 1 at the project level, and ConocoPhillips owning the remaining 30 percent interest.

The Sempra Infrastructure unit in 2023 reached a positive final investment decision for Port Arthur Phase 1 and contracted US engineering firm Bechtel Energy to build the facility.

Progress also continues at Energía Costa Azul LNG Phase 1 on the Pacific Coast of Mexico where construction at the Mexican export project remains on track to reach commercial operations by the summer of 2025.

The San Diego, California-based company is also pursuing a Phase 2 development project at the Cameron plant in Louisiana.

Sempra, the US utility company with power and natural gas services centred on California and Texas and LNG developments in the US and Mexico through the Sempra Infrastructure subsidiary, posted solid third-quarter earnings and said it expected to increase capital investment by up to 20 percent above the current $40 billion over the next five years.

Sempra Infrastructure, the subsidiary of California-based utility and energy company Sempra and with stakes in LNG plants and projects in the US and Mexico, has completed the sale of a stake in the Port Arthur LNG project in Texas to US asset management firm Kohlberg Karvis Roberts (KKR), which is already a stakeholder in Sempra Infrastructure.

Sempra said the sale was complete to KKR on a 42 percent indirect, non-controlling interest basis in the Port Arthur LNG Phase 1 project .

The transaction results in Sempra Infrastructure retaining a controlling 28 percent indirect interest in Phase 1 at the project level, and ConocoPhillips owning the remaining 30 percent interest.

“The closing of this transaction continues the positive momentum of our world-class Port Arthur LNG facility and highlights Sempra Infrastructure's ability to access capital to support the growth of its infrastructure business,” said Justin Bird, Chief Executive of Sempra Infrastructure.

“We remain committed to developing energy infrastructure projects with strong partners to continue growing our portfolio while advancing global decarbonization and energy security,” Bird added.

James Cunningham, a Partner at KKR, said the firm was pleased to proceed with the investment.

“Port Arthur LNG Phase 1 has continued its strong momentum and is on track to meet its objectives of helping to deliver energy security, economic growth and a near-term supply of reliable and cleaner energy,” added Cunningham.

Texas FID

Sempra Infrastructure reached a positive final investment decision for Port Arthur LNG Phase 1 in March 2023 and contracted US engineering firm Bechtel Energy to build the facility.

The company has additionally placed major long-lead time orders with equipment and technology companies Air Products and Baker Hughes.

The $13 billion total estimated capital expenditures for the Port Arthur project are being financed with $6.8Bln of non-recourse project-level debt and $6.2Bln of project-level equity.

The company noted that 100 percent of current contractable capacity for Port Arthur Phase 1 had been secured with long-duration contracts and high-quality counterparties.

“The expected commercial operation dates for Train 1 and Train 2 are 2027 and 2028 respectively,” Sempra said.

Progress also continues at Energía Costa Azul LNG Phase 1 on the Pacific Coast of Mexico where construction at the Mexican export project remains on track to reach commercial operations by the summer of 2025.

The San Diego, California-based company is also pursuing a Phase 2 development project at the Cameron LNG export plant in Louisiana. 

Technip Energies, the leading liquefied natural gas engineering company, reported reduced first-half profits and revenues as the full withdrawal from the Arctic LNG II project in the Gydan Peninsula of Russia was completed amid the gain of a lucrative contract for the LNG expansion in Qatar and with a new record backlog of contracts.

TC Energy Corp., the North American natural gas and energy pipelines company, has received permission from the US Federal Energy Regulatory Commission to bring a pipeline expansion into service for deliveries to Mexico, including feed gas for liquefied natural gas exports.

Air Products, the leading liquefied natural equipment-maker and industrial gases company, said it was chosen to supply process technology and equipment to an electric-driven LNG liquefaction plant in China, its second infrastructure order in a week after the Port Arthur project award in Texas.

Iberdrola, the Spanish utility company and former major liquefied natural player that sold most of its LNG portfolio to Pavilion Energy of Singapore in 2019, said it had agreed to sell 13 mostly gas-fired power plants in Mexico for $6 billion to the Mexican government.

The Mexican President Andrés Manuel López Obrador praised the deal with Iberdrola as a “new nationalization” of the electricity market in Mexico.

The Chairman of Iberdrola, Ignacio Galán, and Mexico’s President López Obrador, announced the deal after a meeting.

Iberdrola said the sales agreement was signed with an entity called Mexico Infrastructure Partners and involved 8,400 megawatts of capacity from 12 gas-fired plants and one 103 MW wind asset called La Venta III.

Iberdrola Chairman Galán said the Spanish utility was still committed to advancing the development of renewable energy in Mexico.

Strategy

“Iberdrola confirms its commitment to Mexico by reaffirming its leadership as the leading private generator of renewable energy with the backing of the Federal Government to continue operating its assets under market conditions and drive the energy transition in the country,” Galán explained.

“In addition, Iberdrola Mexico will continue to serve its existing customers and both parties will work together to try to resolve the various disputes that have arisen in the country in recent years,” the Iberdrola Chairman added.

Leftist President López Obrador had previously compared the attitudes of Iberdrola and several other companies to those of conquerors, a reference to the Spanish Conquistadors who had invaded South America and Mexico in the 16th Century.

Iberdrola had been a major LNG market participant until the 2019 transaction with Pavilion Energy when Iberdrola’s LNG assets were sold as part of the Spanish utility’s €3.5Bln ($3.8Bln) “non-strategic asset rotation” plan.

Mexico itself is a major importer of US pipeline natural gas as well as LNG and also has plans to be an LNG exporter.

New policy

The Mexican President said that the sales agreements for the 13 power plants allowed progress to be made on the implementation of Mexico's “new energy policy” for the future.

The transaction with Iberdrola gives the Mexico’s state-owned power company, Comisión Federal de Electricidad (CFE), or the Federal Electricity Commission, majority control over the electricity market.

“This means we're rescuing the Comisión Federal de Electricidad and this is a new nationalization of our electric industry,” stated López Obrador.

López Obrador added that the acquisition would take CFE's power generation holdings to almost 56 percent of Mexico's total, up from about 40 percent.

A statement said that the deal was expected to be completed within the next five months.