McDermott-Chiyoda ink Cameron LNG incentives deal

McDermott International and its joint venture member Chiyoda have reached an agreement with Cameron LNG related to the construction of its LNG liquefaction project in Louisiana.

The agreement provides the opportunity for incentive bonus payments for achieving construction and commissioning milestones on specified dates for Trains 2 and 3, McDermott said in a statement on Friday.

The deal also aligns the start dates for any schedule-related liquidated damages to be consistent with the current schedule and fully aligns and strengthens the commitment of CCJV to complete the project in accordance with the current schedule.

The favorable financial impact of the agreement is incorporated in McDermott’s previously issued guidance for 2019.

Since the initial award in 2014, McDermott and Chiyoda have provided the engineering, procurement and construction for the Cameron LNG project.

The project includes three liquefaction trains with a projected export capacity of more than 12 million tonnes per annum of LNG, or approximately 1.7 billion cubic feet per day.

As previously disclosed, the project was approximately 90 percent complete as of the end of the first quarter of 2019.

In its statement, Sempra Energy reminded that the commissioning of Train 1 at Cameron LNG continues to advance, and the first commissioning cargo was shipped from the facility earlier this year.

Consistent with previously disclosed timing, Train 2 and Train 3 are expected to begin producing liquefied natural gas (LNG) in the first quarter of 2020 and second quarter 2020, respectively.