Prof. ST Hsieh
Director, US-China Energy Industry Forum
July 20, 2022
Good news for US-China and both parties! It is a win-win-win deal because natural gas is also an accepted transition fuel for combating climate changes.
The Biden Administration should acknowledge this longest supply deal and encourage more energy trades between the US and China.
Cheniere to supply LNG to PetroChina until 2050
July 20 (Reuters) – Cheniere Energy Inc said it would sell liquefied natural gas (LNG) to a unit of PetroChina Co Ltd until 2050, the longest supply deal for the top U.S. LNG exporter.
Demand for U.S. natural gas has jumped in recent months as countries around the globe speed up a shift to the cleaner-burning fuel and Europe tries to wean itself off Russian energy.
The agreement on Wednesday marks Cheniere’s fifth this year, with the company previously striking deals with energy giants Chevron and Equinor.
Cheniere’s LNG unit will supply 1.8 million tonnes per annum (mtpa) to a subsidiary of PetroChina. Deliveries will begin in 2026 and reach the full volume in 2028.
Half of the total volume is subject to Cheniere making a positive final investment decision to construct additional liquefaction capacity at its Corpus Christi LNG Terminal in Texas beyond the seven-train Corpus Christi Stage 3 Project.
Cheniere last month approved an $8 billion expansion of the Corpus Christi plant and signaled that further expansions could be in store. (Reporting by Ruhi Soni in Bengaluru; Editing by Aditya Soni)
Cheniere and PetroChina Sign Long-Term LNG Sale and Purchase Agreement
HOUSTON–(BUSINESS WIRE)– Cheniere Energy, Inc. (“Cheniere” or the “Company”) (NYSE American: LNG) announced today that its wholly-owned subsidiary, Cheniere Marketing, LLC (“Cheniere Marketing”), has entered into a long-term liquefied natural gas (“LNG”) sale and purchase agreement (“SPA”) with a subsidiary of PetroChina Company Limited (“PetroChina”).
Under the SPA, PetroChina subsidiary PetroChina International Company Limited (“PCI”) has agreed to purchase up to approximately 1.8 million tonnes per annum (“mtpa”) of LNG from Cheniere Marketing on a free-on-board basis. Deliveries under the SPA will begin in 2026, reach the full 1.8 mtpa in 2028, and continue through 2050. The purchase price for LNG under the SPA is indexed to the Henry Hub price, plus a fixed liquefaction fee. Half of the total volume, or approximately 0.9 mtpa, is subject to Cheniere making a positive final investment decision to construct additional liquefaction capacity at the Corpus Christi LNG Terminal beyond the seven-train Corpus Christi Stage 3 Project.
“We are pleased to build upon our existing and successful long-term relationship with PetroChina and sign our first LNG contract that crosses over into the second half of this century,” said Jack Fusco, Cheniere’s President and Chief Executive Officer. “PetroChina is a leading energy company in one of the largest and fastest growing markets for LNG. This SPA increases Cheniere’s long-term sales to PetroChina to approximately 3 mtpa, and we are proud to support China’s progress toward a lower-carbon future with our reliable, cleaner burning LNG.”
Commenting on the agreement, Mr. Tian Jinghui, Executive Chairman of PCI stated “Natural gas continues to play a vital role in enabling energy transition in China. We are pleased to further expand our cooperation with Cheniere in delivering LNG, one of the cleanest fuel choices to our millions of customers for many years to come.”