California-based Sempra Energy and UAE-based Saudi Aramco announced their respective subsidiaries, Sempra LNG and Aramco Services Company, have signed a heads of agreement (HOA), for the finalization of a definitive 20-year LNG sale-and-purchase agreement for five million tonnes per annum (Mtpa) of LNG offtake from Phase 1 of the Port Arthur LNG export-project under development.
The HOA also includes the negotiation and finalization of a 25% equity investment in Phase 1 of Port Arthur LNG.
The proposed Port Arthur LNG Phase 1 project is expected to include two liquefaction trains, up to three LNG storage tanks and associated facilities that should enable the export of approximately 11 Mtpa of LNG on a long-term basis.
Port Arthur LNG could be one of the largest LNG export projects in North America, with potential expansion capabilities of up to eight liquefaction trains or approximately 45 Mtpa of capacity.
The agreement with Sempra LNG is a major step forward in Saudi Aramco’s long term strategy to become a leading global LNG player. With global demand for LNG expected to grow by around 4% per year, and likely to exceed 500 million metric tons a year by 2035, we see significant opportunities in this market and we will continue to pursue strategic partnerships which enable us to meet rising global demand for LNG,
…stated Amin Nasser, Saudi Aramco’s CEO & President.
Earlier this month, the US Department of Energy issued Port Arthur LNG’s authorization to export domestically produced natural gas to countries that do not have a free trade agreement with the US.
Last month, Port Arthur LNG and its affiliates received authorization from the Federal Energy Regulatory Commission to site, construct and operate the liquefaction export facility and related natural gas pipelines.
