Cheniere and Sinochem sign long-term LNG SPA
U.S. LNG exporter and producer Cheniere Energy has signed a long-term sale and purchase agreement (SPA) with the Chinese state-owned energy company Sinochem Group.
The parties signed the agreement for a term of approximately 17.5 years.
Under the SPA, Sinochem will buy an initial volume of approximately 0.9 mtpa of LNG beginning in July 2022. This will, however, go up to 1.8 million tonnes per annum (mtpa).
Sinochem will purchase the LNG volumes on a free-on-board basis. The purchase price for LNG under the SPA is indexed to the Henry Hub price, plus a fixed liquefaction fee.
Additionally, Cheniers says this SPAwill further its role in providing clean and reliable energy to the Chinese market.
Jack Fusco, Cheniere’s CFO, said: “In addition, the SPA further reinforces our commercial momentum, and once again confirms the strength of the global LNG market and the global call for investment in additional LNG capacity, including our Corpus Christi Stage 3 project.”
The Corpus Christi Stage 3 project will include up to seven midscale liquefaction trains with a total expected nominal production capacity of over 10 mtpa. Moreover, it has already received all necessary regulatory approvals.