U.S.-based Commonwealth LNG and Switzerland-based MET Group have entered into a Heads of Agreement (HoA) for the sale and purchase of one million tons per annum (mtpa) of liquefied natural gas (LNG) for 20 years from the Commonwealth LNG facility currently under development in Cameron, Louisiana, U.S.
The terms anticipated under the non-binding HoA will commence at the start of the commercial operation of the facility in 2027, the companies informed, noting that final terms remain subject to negotiation of a definitive Sale and Purchase Agreement (SPA) between the parties.
Currently, Commonwealth LNG is working on the remaining steps necessary to achieve its goal of making a final investment decision (FID) on the project in the first quarter of 2024, with the first cargo deliveries expected in 2027.
The project is permitted and is expected to include six natural gas liquefaction trains and associated facilities capable of producing approximately 9.3 mtpa of LNG.
Commonwealth LNG Founder and Executive Chairman Paul Varello said: “This agreement recognizes that U.S. LNG can and will play a continuing role in Europe’s energy transition by providing reliable and affordable natural gas to the region. We are excited to work with MET Group to deliver LNG on a long-term basis to contribute to the security of the natural gas supply of their customers.”
MET Group Chairman and CEO Benjamin Lakatos noted: “LNG supply into Europe is a significant contributor to gas supply diversification and an important contributor to European energy security. LNG is also becoming an important part of MET Group’s strategy going forward.”
MET said that in 2022, it imported more than 30 TWh of LNG cargoes to countries including Croatia, Greece, Spain, Belgium and the UK, and this year, it secured long-term LNG capacities in Germany and expanded its spot capacity reach to Finland.