Sempra Inks 15-Year LNG Supply Deal with Germany’s RWE
(P&GJ) — Sempra Infrastructure, a subsidiary of Sempra Energy, has entered into a long-term sale and purchase agreement with RWE Supply & Trading, a subsidiary of RWE, for the supply of approximately 2.25 million tonnes per annum (MTPA) of LNG from the Port Arthur LNG Phase 1 project under development in Jefferson County, Texas.
The LNG will be delivered on a free-on-board basis for 15 years.
The agreement also provides a framework to explore ways to lower the carbon intensity of LNG produced from the Port Arthur LNG Phase 1 project through GHG emission reduction, mitigation strategies and a continuous improvement approach.
"We could not be more excited to finalize our agreement with RWE as we continue supporting the energy security and environmental goals of our European customers," Justin Bird, CEO of Sempra Infrastructure, said. "Because of its scale, location and permitting status, Port Arthur LNG is benefitting from a lot of commercial momentum with nearly all the projected off-take capacity for Phase 1 now under long-term agreements with some of the leading global energy companies. Today's announcement moves us one step further along in the process of making Port Arthur LNG a reality."
Sempra Infrastructure recently announced it has entered into long-term agreements with ConocoPhillips, INEOS and ENGIE for the sale and purchase of approximately 7.3 MTPA of LNG from the proposed Phase 1 project. The company is focused on completing the remaining steps necessary to achieve its goal of making a final investment decision for Phase 1 of the liquefaction project in the first quarter of 2023, with first cargo deliveries expected in 2027.
The Port Arthur LNG Phase 1 project is permitted and expected to include two natural gas liquefaction trains and LNG storage tanks and associated facilities capable of producing, under optimal conditions, up to approximately 13.5 MTPA of LNG. A similarly sized Port Arthur LNG Phase 2 project is also competitively positioned and under active marketing and development.
Development of both phases of the Port Arthur LNG project is contingent upon completing the required commercial agreements, securing and/or maintaining all necessary permits, obtaining financing, and reaching a final investment decision, among other factors.
"Our partnership with Sempra Infrastructure, one of the leading companies for LNG infrastructure in the U.S., is another important step to diversify Germany's gas supply and thus contributes to enhancing security of supply in Europe on a long-term basis," Andree Stracke, CEO of RWE Supply & Trading, said.
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