LNG

Sempra Infrastructure, a subsidiary of California utility company Sempra, has signed a long-term LNG sale and purchase agreement (SPA) with a central European fuels group that recently acquired the Polish Oil & Gas Company.

The Sempra deal with the Poles is for the supply of 1 million tonnes per annum of LNG cargoes on free-on-board basis for 20 years from the first phase development of the Port Arthur export project in Texas.

The Port Arthur LNG first phase project located in Jefferson County, Texas, has all of its necessary permits and is expected to include two large liquefaction Trains, each with 6.75 MTPA of output, as well as LNG storage tanks and associated facilities for total production of 13.5 MTPA.

A similarly sized Port Arthur LNG second-phase project with another 13.5 MTPA of output is also under active marketing and development.

The SPA with the Polish company, Polski Koncern Naftowy Orlen (PKN Orlen), means that the first phase of the Port Arthur project is now fully subscribed for the limit Sempra has set itself.

In aggregate, the first phase of Port Arthur LNG is now subscribed for 10.5 MTPA under binding long-term agreements.

This leaves Sempra, which also operates the Cameron LNG plant in Louisiana, with room to supply own possible marketing operations.

The full Port Arthur development plan, the Texas facility is aiming for first cargo deliveries in 2027.

“We are excited to partner with PKN Orlen, Central Europe's largest energy group, as they continue to look for long-term, diverse supplies of secure energy sources,” said Justin Bird, Chief Executive of Sempra Infrastructure.

“With the long-term off-take capacity for Phase 1 now sold under binding agreements, we expect to reach a final investment decision later this quarter and commence construction,” added Bird.

Daniel Obajtek, CEO of PKN Orlen, said he was delighted to enter into this long-term agreement with Sempra.

“This is an important step towards strengthening PKN Orlen’s position as a cornerstone of crude and fuel supply security in Central and Eastern Europe,” declared Obajtek.

“Already last year, during a very tense situation on the EU energy market, the US became one of the main suppliers of natural gas to Poland,” he noted.

Sempra Infrastructure has previously entered SPAs with leading European energy and utility companies as well as the US major ConocoPhillips.

They include the German and French utilities RWE and Engie along with European chemicals company INEOS.

The Brownsville Navigation District and the US Army Corps of Engineers have signed a joint agreement for Phase 2 of the Brazos Island Harbor (BIH) channel improvement project, allowing Brownsville to become one of the deepest ports in the Gulf of Mexico before it welcomes LNG carriers.

NextDecade, the US developer of the Rio Grande LNG export project along the Brownsville Ship Channel, has confirmed that a final investment decision for the venture would again be delayed, this time until the second half of 2022.