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US Venture Global signs LNG deals with China's Sinopec: Documents

US Venture Global signs LNG deals with China's Sinopec: Documents

A man takes pictures of models displayed at the Sinopec booth during the 2021 China International Fair for Trade in Services (CIFTIS) in Beijing, China on Sep 4, 2021. (Photo: Reuters/Florence Lo)

SINGAPORE: US exporter Venture Global LNG has signed two 20-year deals with China's state-owned Sinopec to supply liquefied natural gas (LNG) from the Plaquemines plant, according to a document posted on the country's department of energy website.

This brings the plant in Lousiana, with an export capacity of up to 20 million tonnes per annum (mtpa), one step closer to making a final investment decision which is expected by the end of this year.

For China - which has this year overtaken Japan as the world's top LNG buyer - the deals will be its single largest LNG trade agreement in terms of volumes, a senior Beijing-based gas industry source told Reuters.

Both deals are sales and purchase agreements, with volumes totalling 4 million tonnes per annum (mtpa), according to the notice, which did not specify when the supplies will start but added that they were signed last month.

One of them is for 2.8 million tonnes a year (mtpa) of LNG sold on a free-on-board (FOB) basis and the other deal is for 1.2 mtpa of LNG sold on a delivered at place unloaded (DPU) basis.

Venture Global also signed a third deal with Unipec, the trading arm of Sinopec, to supply 1 mtpa of LNG from its Calcasieu Pass Facility for three years starting Mar 1, 2023, according to a separate document also posted on the US government website.

Sinopec declined comment while Venture Global could not be reached for comment outside business hours.

Reuters reported last week that major Chinese companies are in advanced talks with US exporters to secure long-term LNG supplies amid soaring gas prices and domestic shortages.

Venture Global's deal with Sinopec follows an earlier announcement by China's privately controlled ENN Natural Gas Co for a 13-year deal with US LNG exporter Cheniere Energy, which was the first major US-China deal since 2018.

Venture Global is building or developing over 50 million tonnes per annum (MTPA) of LNG production capacity in Louisiana, including the Plaquemines LNG export plant which is expected to enter commercial service in 2024.

Source: Reuters/zl


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