US-based Energy Transfer said its liquefied natural gas (LNG) unit has entered agreements to supply a total of 2.7 million tonnes of LNG to China’s ENN Natural Gas and ENN Energy Holdings.
Companies have rushed to cash in on higher natural gas prices as sanctions on Russian fuel have shocked an already tight supply.
The supply agreements are for a term of 20 years and first deliveries are expected to begin in 2026, the Dallas-based pipeline company added.
The companies did not disclose the purchase price, but said it is indexed to the Henry Hub benchmark plus a fixed liquefaction charge.
The number of US proposed LNG projects to reach final investment decision is expected to get a push following demand from Europe to replace Russian gas over the next few years.
There are currently 13 proposed liquefaction projects totalling 22 billion cubic feet per day that have received US Department of Energy and Federal Energy Regulatory Commission approval, but have not reached final investment decision status.
Those likely to receive financial approval this year are Venture Global’s Plaquemines and Tellurian’s Driftwood plant, both in Louisiana, and Cheniere Energy’s Corpus Christi Stage 3 project in Texas, according to a recent report by Bank of America.
That list could expand in 2023 to include the proposed fourth liquefaction train at Sempra Energy’s Cameron, Venture Global’s Calcasieu Pass Phase 2, and Commonwealth LNG, all in Louisiana, Bank of America said.
It also includes Freeport LNG’s proposed fourth liquefaction train at its LNG export plant in Texas.
- Reuters, with additional editing by George Russell