Dec. 1—Sempra's Port Arthur LNG said Thursday that it signed a long-term contract with British multinational energy company INEOS, the liquefied natural gas project's second such deal in less than two weeks.
Under the 20-year sales and purchase agreement, INEOS committed to buy 1.4 million metric tons per year of LNG from the facility in Port Arthur. INEOS also signed a preliminary agreement for an additional 200,000 metric tons from the project's potential second phase.
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The deal with INEOS follows a major agreement last month between San Diego-based Sempra and Houston-based oil and gas producer ConocoPhillips, which agreed to buy more than a third of the Port Arthur project's annual production and a 30 percent stake in the development. The partnership gave Sempra a firmer foundation for building the first phase of its 13.5 million metric ton facility in Port Arthur.
The INEOS deal also demonstrates that some European buyers can still be tempted into long-term contracts with gas projects along the Gulf Coast. Deal-making with European buyers has been slow compared to Asian counterparts as Europe grapples with how to meet the continent's urgent energy needs while also easing off fossil fuels.
The British company said its deal with Port Arthur LNG will help it "deliver cleaner and reliable energy to our businesses and customers."
"We look forward to advancing this project so we can begin delivering new supplies of U.S. LNG to our European partners, as they pursue more secure energy for their customers," said Sempra CEO Justin Bird.
Sempra said it expects to reach a final investment decision, which is a precursor to construction, during the first quarter of next year. It aims to launch the facility in 2027.
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